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Before we get too enthusiastic about building a tech portfolio, let's keep
in mind that in the larger picture, the NASDAQ is probably very close to a
500-900 point bear market rally to be followed by yet another leg down. The
bearish wave count is reinforced by the NASDAQ's total inability to
successfully challenge the top of the channel during a 2200 point (52%)
decline from the 01Sep01 high. Attached is an AGet weekly chart with weekly
wave counts and MOB's and a another set (log scale) using weekly close only
data which compares the current decline to the 1972 crash. One should keep
in mind that the 1970's bubble did not begin to approach the scope of the
current mania so this decline in the NASDAQ is likely to be more protracted.
On a more optimistic note, my NYSE and NASDAQ breadth models, which have
been locked in sell mode for well over a month have completed the basing
required to trigger a buy signal on the first day on which decent breadth
returns to the market.
Finally, I would suggest that one might do well to forget about bottom
fishing techs (the Nifty Fifty of the 70's took years to recuperate) and
look at stocks in sectors which are on the positive end of investor and
institutional money flows (recent examples include retail, health, and
energy). There are stocks which have been climbing all through this last
decline. My weekend sector screens show accelerating accumulation in the
energy, transportation, defence, and a small amount in some of the
electronics sectors e.g Laser Systems.
Earl
----- Original Message -----
From: "Don Ewers" <dbewers@xxxxxxxxxxxxx>
To: "Real Traders" <realtraders@xxxxxxxxxxxxxxx>
Sent: Sunday, March 11, 2001 6:37 AM
Subject: [RT] Valuation - Tech
> Avoiding trying to figure when and where the NASDAQ will potentially turn
> for the moment, what is the criteria one should use to invest again in
> technology.
>
> If possible let us also avoid an economic turn which understandably is a
big
> part of the formula as is "product", market potential and so on. It is
> certainly not just price (XYZ has dropped below $20).
>
> Past earning performance, price to sales, price to book . . . . what does
> the "institutional" investor use to decide when to step in and "invest"
once
> again in this sector (or should I say carnage) assuming their investment
> horizon extends out for 1-2 years maybe more.
>
> Is there anyone on the list that knows what they look at (understanding
> there may be better areas to invest in such as energy, value companies
etc.
> right now).
>
> Bottom line when will the Intel's, Sun Micro's, Cisco's, Microsoft's, LSI
> Logic, ADC Telecommunications have "value"? Thoughts anyone. Does this
> really represent a significant opportunity today for one who has so far
> avoided this massive drop, as some are touting?
>
> The charts should tell us when to invest and that may be the ultimate
> answer, but for the moment is there any "fundamental's" one could look at
> also.
> don ewers
>
>
>
>
> To unsubscribe from this group, send an email to:
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>
>
>
> Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
>
>
>
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