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Jim,
Thanks for your opinion and strategy.
But I don't think we have seen the bottom of this correction yet.
For the Dutch stock market the advance/decline and call/put-ratio give more
bad news for the near future...
DJIA support 8300, when broken: price target 7300 (head&shoulder)
S&P500 support 1060, when broken: price target 940 (head&shoulder)
AEX support 1120, when broken: price target 920 (head&shoulder)
Onno
At 14:55 22-8-98 -0400, you wrote:
>All,
> A choppy week for the market in which my portfolio dropped a
>little. However, I wasn't stopped out of any positions and now have
>AOL, BBY, DELL, INTC, and SMOD stock, CPQ LEAP calls, and about 30%
>cash. Also, the market action reinforced my thoughts that we have
>seen the market low for a while. The Dow Jones Industrial Average
>(DJIA), for example, is typical of the indices that I watch. It
>dropped Friday to test the 8/5 and 8/11 lows and they held. In fact ,
>it spiked through the bottom of the long term channel interday only to
>pull back and close well above the bottom of the channel. That's
>another indication that we have seen the lows for this correction.
>However, to play it safe, I'm going to stick with the large cap market
>leaders again this week. I may begin to add some small cap spice next
>week if we have a good week in the market. This week I'm going to
>move to the Drug & Pharmaceutical group and pick Warner-Lambert
>Company (WLA).
> WLA at 71.8125 is in an Intermediate Term Up Trend Channel
>(ITUTC) with the top at 90 1/8 and the bottom at 69. It's another
>momentum play that hit an all time high of 85.9375 on 7/20/98. It
>then pulled back to a low of 68.5 on 8/4/98 and has essentially moved
>sideways from there, getting close to the bottom of its ITUTC and
>breaking out of its short term down trend channel Wednesday. It may
>still move down a little more to touch the bottom of the ITUTC, but it
>also may not and this looks like a good entry point to me. The
>PDI-MDI and directional movement indictors look like they are trying
>to signal the start of a new short term up trend. The fundamentals
>are OK with the price/sales a little high at 6.27, the debt/equity
>good at 0.59, 7% insider ownership, good earnings and revenue growth,
>and a pipeline full of new products. I'll open a position Monday.
>I'll set my target just under the top of the ITUTC at 90 and my stop
>just under the bottom of the ITUTC at 68 3/4. I'll move the stop up
>to under the bottom of the short term up trend channel just as soon as
>it forms <G>.
>
>Jim
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