A Weak Bounce
By Duru
January 10,
2005
Just as I was thinking, the market obliged
my ruminations with a bounce. Given its position as the most stubborn index, it
was not so surprising to see the housing sector bounce the best. But as
Mike demonstrates, the bounce was quite weak and unimpressive. In fact, he
figures the market is due to give up the ghost any moment now! Since I think the
market has probably already put in its top for the year, it makes me no mind
whether the market begins selling off after a decent bounce-back rally or
tomorrow. (Actually, I DO care in the sense that I still have some longs out
there!).
Let's continue
with the follow-ups.
On September 12,
2004, I derided a flagging survivor of the
telecom bust for mass firing off its employees and clinging to its last few
pennies. On Friday, this company, CoSine
Communications (COSN), hit the jackpot, sort of, and essentially transferred
its cash to Tut Systems (TUTS). I did not bother
digging through the dirty details of the deal, but it seems that TUTS is making
out like a bandit, and the market responded in kind by adding 9% to what is
already looking like a very nice rally in the stock. Now we know why all those
employees had to be cleared out of there. It made COSN a much more attractive
acquisition, and there are fewer folks around to share the spoils!
October 11,
2004, I applauded the
potential of MFLX, a small stock where insiders looked like they were
loading up. Given my brilliant knack for timing, I decided to wait until the
near top to try to make money from my own astute observations. Ugh!
October 12,
2004, I
practically laughed to the bank at Pulte Home's (PHM's)
stumble in Las Vegas as it backed down from pushing the desert's bubble ever
bigger. Looks like the joke is on me (and anyone who tried to short that news)
- PHM has not only recovered all of the losses from that embarrassing episode,
but it also is challenging new all-time highs again. Talk about stubborn! Speaking of recovery,
I noted to anyone listening that something seemed a-brew at the flash companies.
Right after that, SNDK blew up on an earnings report and took the sector down
with it. SNDK and FLSH have recovered quite nicely from this collapse. LEXR is
still struggling.
On November 24,
2004, I picked up the speculative
junk story of NVE. It seems the market has truly gotten serious about
sending this company's stock back where it belongs. The sell-off has continued
nearly unabated….just two rest stops where some news brought temporary hope and
relief only to become good spots for new shorts to jump on the bandwagon. The
first 6 trading days of 2005 have been particularly brutal.
I hope to
provide updates on a more regular basis. I know it is easier to talk about news
as it is happening than it is to follow that news and watch and wait for the
storyline to play out. So, this writing discipline should be good practice for
me.
In the
meantime, be careful out there!