Steve Zito, Wharton School BS Econ, MS Fin, HTML Writers Guild
uses economic and technical analysis to forecast the direction of the stock market. The views in this newsletter are opinions only, and should not be solely relied on for your investment decisions.
*SMD Sept. 15 *SMD Sept. 8 *Sitemap *SOPRANOS *Subscribe

NASDAQ COMPOSITE
INDEX closed 1291.40

Sept. 16, 2002. Chip Stocks and Mr. Softee

******************Page Two*******************
Go To Page 1 On Sept. 13 Nasdaq Composite closed at 1291.40 +11.72 Nasdaq fell 3.90 (-0.3%) since my Sept. 9 page. Definition, if the stock closed above its 90-day moving average, MA is support. If the stock closed below its 90-day moving average, MA becomes its resistance. Intel closed 16.03 +0.33 (+2.1%) below its moving average resistance at 16.20. RSI, MACD are negative, stochastics trying to rebound from over-sold to 24%/28%. Subscribers who did buy at 16.99 on Aug. 28, were stopped out at 16.20 on Sept. 3. For those who were stopped out at 16.20, Intel then traded as low as 15.03 on Sept. 5, its 52-week low, money is better off in AMD or Nvidia. PSR for Intel is 4.04 compared to 0.74 for AMD, 0.85 for Nvidia. AMD closed 7.21 -0.43 (-5.6%) below moving average resistance at 7.90. I recommended buy at 6.99 in June, or AMDAB at 0.75 (August 2). Subscribers missed the stock Aug. 2 at low of 7.01, but grabbed the call at 0.75. Then AMD rallied up over 10.82, AMDAB went to 2.50 and I recommended to sell call positions. AMD is retesting 7.00 again, and I continue to recommend at 6.99 for long-term investors. For intermediate-term traders, recommend Jan. 10 AMDAB call option. Bid 0.25. Dell is introducing new unbranded PC, AMD could be prime MPU vendor. Nvidia closed 10.57 -0.17 (-1.6%) above moving average support 10.39. RSI negative, turning neutral. MACD remains slightly positive ever since mid-August. Stochastics which were rising since Sept. 3, bearish, falling to neutral 55%/68%. Microsoft has been in arbitration with Nvidia over chip pricing and production amounts for Microsoft X-box chips, pricing, production contractually dictated by Microsoft. Determination next June could force Nvidia to produce for Microsoft at a loss. Government lawyers could not win against Microsoft on anti-trust monopoly practices, so how will Nvidia? Both Microsoft and Nvidia have declined from 70 in Jan. 2002, Nvidia much more, due to competition from ATI and severe concentration risk on Microsoft X-box dependency. Microsoft closed 47.91 +0.76 (+1.6%) below moving average resistance 48.27. RSI and MACD negative, stochastics rebounding from over-sold to 25%/24%. Subscribers bought the Jan. 55 call (MSQAK) at 2.55 when the stock hit 48 on Sept. 3. This call, like the AMD call, has 4 months for MSFT to break 55. Watch X-box stories. Microsoft will be chased by fund managers when the stock markets ever wake up. To those 25-year old Harvard MBA's hired by Fidelity Investments in Boston, Mr. Softee is a no-brainer, and no one ever got fired for buying Microsoft for fund portfolios. Compare Microsoft to Nvidia, its chip vendor. Both stocks traded as high as 70 in January. Today, Microsoft trades at 4 1/2 times the stock price of Nvidia, its PSR is 9.08, or 10.68 times Nvidia at 0.85. Subscribers to my Newsletters were reading this Sept. 15. SPECIAL. Get 2 to 3 issues a week for 6 months for only $50. For 150 newsletters
How to Use Site. Divesting Convicted Andersen. $50 Subscriber Deal
Copyright Notice, all pages Copyright©2002 and are made available as a service to the global Internet community. Pages may not be reproduced or sold in any medium without explicit, written permission from Steve Zito.