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All,
The bad news is that my portfolio was down for the week and I was
stopped out of AOL and MSFT Friday. Then RBOT closed below my stop Friday,
so I'll close that position Monday. That means I went from 100% invested
last Monday to almost 45% cash this Monday when I close RBOT. The good
news is that while all the indices dropped last week, most of them are still
just above the bottom of their Intermediate Term Up Trend Channel (ITUTC).
Since these are all well-defined channels, I'm expecting them to hold and we
should have a good week this next week. However, to hedge my bets in case
we do break to the downside, I'm only going to try to add one new position
this week. If we do bounce off the bottom of the channels during the week,
I'll revert to fully invested next week. My pick this week is Cambridge
Technology (CATP). CATP provides management consulting and systems
integration. It combines management consulting, IT strategy, process
innovation and implementation, custom and package software deployment,
network services, and training to deliver business solutions for clients.
CATP at 18 1/8 is in a Short Term Up Trend Channel (STUTC) with the top
at 25 and the bottom at 17 ¼. It peaked at 58 3/8 on 07/07/98 then fell in
two waves to a low of 10 5/8 on 03/26/99. From there it rose and broke out
of its Intermediate Term Down Trend Channel (ITDTC) on huge volume on
05/18/99. It then moved sideways and spurted up again on big volume a week
ago. This last week it drifted back down to hit the bottom of STUTC
Wednesday and Thursday then closed up a little Friday. This looks like
another bounce off the bottom of the channel and should be a good entry. I
got a Tema PDI-MDI buy signal a couple of months ago and those indicators
still look like they are still setting up for a big move. The fundamentals
are good with the price/sales 1.76, no debt, and a five-year growth rate of
over 30%. I'm going to set a buy stop just above the 3-day high at 19 ¼.
If I get the position, I'll set the target just under the old high at 58 and
my stop just under the STUTC at 16 ¾.
I've got a full page chart at my web site:
http://www.geocities.com/WallStreet/Highrise/1025/
JimG
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