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PAIR fell 17% today when Soundview Financial said nasty things about
Pairgain. Strangely enough, "SoundView analyst Chandan Sarkar said he
has become more cautious on PairGain but has not changed the rating or
earnings estimates. "
See http://biz.yahoo.com/finance/97/05/16/adtn_pair_1.html
PAIR had been rising steadily for two years until last October. Then
it fell, went sideways, and climbed back to re-test the Oct high in
January. It made a double top in February, and then started a
downtrend channel. It has dropped from $42 to $17, and the PE is
still a high 36.
This is not a stock I would be in for the long-run right now. But it
might make a good channel trade.
The top of the channel is defined by the highs of 2/14, 4/7, 4/9, and
5/9. The bottom of the channel is defined by the lows of 1/16 and
3/19.
Today, the bottom of that channel is at 16 3/4. PAIR hit 17 1/8
today. I am very tempted to buy at this level Monday. But I'm
worried by how fast PAIR came down. It may overshoot next week.
Any opinions out there?
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