Thursday, October 7, 2010

Bookkeeping: Buying F5 Networks (FFIV) and Riverbed Technology (RVBD) on the Open

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The ability for the market to ignore the carnage in the leadership group of the 'cloud' yesterday was something to behold.  We remain in freight train status, as speculators simply shifted into the energy/oil complex and kept the train rolling.  There is a lot of damage done in some of the cloud charts and I am not yet convinced yesterday won't be looked back at a turning point but I definitely could be wrong.  Generally when your leadership stocks take such a hit, it is a canary in a coal mine... but I am going off historical reference; not a "Fed is manipulating prices upward" environment.

I was stopped out of a lot of exposure yesterday, so I am going to focus on some of the names whose charts sustained less damage.  With that I am putting about 1.5% into both Riverbed Technology (RVBD) and F5 Networks (FFIV).




I don't like the valuations at all, but am trying to keep some long exposure going so as to not completely miss all the gains the market is sure will continue with the Bernanke put in place.  Frankly at this point with the S&P 500 up 120+ straight points, all purchases are with reluctance. I will have tight stop losses in place, because all good parties end in tears - if this ends in 3 days, 3 months, or 3 years I don't know.  And I will be exiting a great portion of these positions no matter the case in a few weeks as earnings approach.

The charts above are still holding in there, versus a lot more damage done in names such as VMWare (VMW) and Salesforce.com (CRM)... I'll be especially curious to see if Salesforce.com (CRM) can recapture the $114+ level quickly - 2 analysts came to the defense this morning because we cannot have CRM down for more than a few days in a row.  To me, this one looks damaged technically.



Long all names mentioned in fund except VMWare; no personal position


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