The Play Of The Day
April 14, 2000
08:50 AM EST.
Good Morning Stock Fans!
BREAKING NEWS: CPI increase 2 x what was expected! CPI increase greatest since January of 1995. CPI report takes S and P. Futures from up 5.50-6.00 to down 10.00 fair value at 3.10 today. It puts us way under as an indication to markets open today. This report with its core rate so much higher then expected should be more then enough to send the NASDAQ back down to easily test last Tuesday's 3,649.00 move.
NASDAQ MARKET OUTLOOK TODAY:
You have to wonder if Market Technicians had placed those bets to the date 3 weeks ago to set this market up for what it is about to realize today when the FED increased by . 25 on March 22, 2000. As I have stated several times since then the NASDAQ was right about 4,500 area then. A . 50 increase would have sent us to 4,000 and with a core increase like we saw today if one imagines the market new of that on March 22, 2000, one can deduct that the NASDAQ would drop yet another 500 points. We have averaged of late with the incredible rise of stocks on the NASDAQ about a 500 point drop on the NASDAQ per . 25 basis increase so to offset today's number if that data would have been available to the FED on March 22, 2000. The FED then to offset the total increase (Granted the FED would never increase . 75 in one meeting. The would instead do it in chunks. However lets for the purposes of my example today say the FED took care of all of it at one point. ) We would indeed then expect the NASDAQ to go where? Precisely right to 3,500.00 and with us closing yesterday at 3, 676.78 that leaves about 176.78 to find 3,500.00 and less then 30 points today to find 3,649.00
Stock Fans! CSCO is a KEY INDICATOR with over 104 million shares traded yesterday CSCO dropped of an open of over 66 to almost lose 60.00 by the close. CSCO 200 day moving average is $59.43750. This number we will watch very very close. This number should be our indicator therefore CSCO at 58-57 should be about the bottom today. I will be looking to nibble on KEY Tech issues today in anticipation of knowing the downside is minimal, and the upside going of the NASDAQ's all time high reechoed so recently is the MOON!
The only thing that saved stocks on the NASDAQ yesterday was the BELL! The NASDAQ a fighter now with a big cut under its eye with the terrible CPI today will indeed bring about panic. Stocks will drop right off the open. We will look for major selling right off the open and then go back in LONG as the NASDAQ as well as the entire market should wash out today on panic anyone left now that has not sold since 3649.00 Tuesday low became 4148.49 its close. (a difference of 499.00 Amazing is that about 500 points indeed it is that number has been found now with a move to 4448.00 to the upside to have enough downside momentum to find 3500 or goodness could we go lower? We may the panic will be huge off today's open and where the market technicians turn over those massive short positions and cover for huge gains that's where the NASDAQ should stop the downturn and stabilize again finding buyers wanting in knowing full well the NASDAQ was over 5,000 less then 5 weeks ago!
The NASDAQ holding 3,500 doesn't look good if you are a chart watcher today. The NASDAQ back on November 1, 1999, was at 2,997.00. Yes, believe it or not we were under 3,000 as October 1999 ended. The NASDAQ has great support under 3,500 at 3321.57 This area is way down I know but it is a good idea to know the NASDAQ next double bottom that we have not hit yet is 3321.57 reached on DEC 1, and 2, 1999. I think we more then hold this number. I look at 3503.00 reached just about 6 months ago as a spot they save this market and turn it up to avoid 3321.00. 3321.00 would be more then 1700 points of the NASDAQ's all time high and more then a 40% loss on the NASDAQ since then. The NASDAQ bear market indication is 20% Dona so 2 x that is way to much. I therefore like a 30% loss on the NASDAQ as the spot we hold today. Its not on the chart but its dead in the middle of 20% down bear market and 40% down 3321.57. So I will indeed look for NASDAQ 3515.00 as the spot we turn the NASDAQ around going long big time!
Today's Play of The Day JDS Uniphase (NASDAQ:JDSU)
Stock Fans, How about this! Sop you have always wanted JDSU a great stock to have owned one that has been a true leader over the last 2 years! Well, you want it on sale! Guess what! Let's steel it today!
JDSU was way over 100.00 when the NASDAQ biggest slide began on April 4, 2000. Since then JDSU tested $82.00 on April 4, 2000, was the intraday low. The close was over 115.00 and Wednesday Low was 96.00. We have already lost $96.00. I have calculated the ranges and now we have lost another KEY NUMBER 90.6250 a number that had a gap ahead of it that filled. (0.6250 was also yesterday's low. However as I stated in pre market JDSU after the CPI today has lost that and is indicated at under $89.00 today! The bottom then is doing the calculations of yesterday's high of 101.50 to the 82.00 move on Tuesday is... $80.50 I buy JDSU right there today. Going LONG and strong if it loses 80.00 it won't be for long!
KEY INDICATORS: JDSU
BUY Area: $79.8750- $80.50
Sell Stop: $74.00
JDSU reports numbers April 25, 2000. It can't drop after those come out!
Time Frame: AM April 25, 2000 ahead of number we may see $115.00
RUN THE OPTIONS: JDSU
The May 100.00 Option Calls!
BONUS PLAY #1 ADC Telecommunications (NASDAQ: ADCT)
ADC Telecommunications, Inc. provides hardware and software systems and integrated solutions that enable customers to build and upgrade communications networks. ADC's products include hardware and software systems and integrated solutions. Broadband Connectivity products provide the physical contact points for connecting different communications system components and gaining access to communications system circuits. Business Broadband products enable telephone companies to deliver voice, video and Internet/data services to their business customers. These products include transport and access systems. Residential Broadband products include digital transport systems that enable cable TV operators to transport high-speed digital signals for two-way voice, data, Internet and video services to homes. The Integrated Solutions products include consulting, software and systems integration services to aid customers in integrating ADC and other complementary products in communications networks.
Stock Fans, you are probably asking why go long in this market. My answer is this. When a stock that is able to buck the selling pressure and continue up means you have one strong stock. ADC's closing price closed above its 10 day moving average on strong volume. It has grown earnings ( yes it has the e in p/e) and sales and sports a 32% growth rate. ADC has the strongest accumulation and timing rate given. l look to take a small position and add as it moves up.
Key Indicators: ADCT
Buy Area:$50.00 to $52.00
TARGET:$57.20 to $59.80
Time Frame: 2 to 7 days
Type of Trade: Swing Trade
Daytrade for 1-2 point scalps
Have a great day !
More to come.....
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