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All,
Another great week, that's three in a row. Anyone for four <G>.
I've finished my weekly tests and looked at my watch lists. The tech
sector has been looking good the last few weeks and I think it's ready
to lead the market up again. My current portfolio has EGRP, INTC,
IOM, PAYX, RDC, and SPF stock; BTTRX and DHIYX Bond funds,; and HM,
MADGF, and PFE LEAP calls. Of those, only INTC, IOM, and MADGF are
true tech stocks so I wanted to add one more. I decided on Smart
Modular Technologies (SMOD). SMOD designs, manufactures, and markets
memory modules, personal computer card products and embedded processor
modules for the telecommunications, computer, and networking
industries.
SMOD at 29 1/4 is in a Long Term Up Trend Channel (LTUTC) with
the top at 51 7/8 and the bottom at 23. SMOD hit its all time high of
44 5/8 on 10/03/97. It then fell to its 10/28/97 low of 17 1/2 which
was right on the bottom of the LTUTC. It bounced up immediately and
recovered to 34 in late November. From there it pulled back and
bounced off the bottom of the LTUTC twice in December and again on
1/09/98 so the LTUTC is well confirmed. It then broke out of its
Short Term Down Trend Channel in mid Jan and rose to 31 1/2 before
pulling back to Fridays close. I've constructed a Short Term Up Trend
Channel (STUTC) and it looks like SMOD bounced off the bottom of that
channel Friday. However, there isn't much data for the STUTC and I'm
not going to trust it for stops until we get a few more weeks of data.
I got a MetaStock Tema di, S/C buy signal on 1/28/98. Both di and S/C
are positive and rising. The fundamentals look good with Price/Sales
at 1.81, no debt, 68% insider ownership ( I like that), and 46%
revenue growth and 68% earnings growth last year. I'm going to open a
position Monday with the target just under the LTUTC at 51 and the
stop just under the LTUTC at 22 3/4. If we get a good move up from
here, I'll move the stop to under the STUTC in a couple of weeks.
I'll send a SMOD.GIF chart to everyone on the email list. If
you're not on the list and want on, just yell.
Jim
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