Re: [CBS MarketWatch] Analysts mixed on CMGI results

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From: Jeff Bone (
Date: Fri Sep 22 2000 - 20:02:11 PDT

> As you probably know, capitulation helps to create durable Market
> bottoms: freak out the weak (=small) investors, allow the
> institutional investors to load up at sale prices.

This is true in a generalized case, but --- and pardon my technical
analysis newbie-ism, I've only been to one Omega World conference (but I
did see Charlie Wright's seminar ;-) --- it seems to me that, on a tactical
level, CMGI has been doing nothing but testing a hard bottom for the last
couple of months, sans a few small spikes. Watch me say that and it shoot
down into the 20s next week, god forbid, there goes my whole wad. ;-)

> The significance
> to individual stocks is that it marks a level at which institutional
> investors are willing to step in and support the price. It's only
> after they've bought all that they want that the stock price can move
> up in any substantial way. That is when the sell-side analysts will
> begin issuing their "strong buys."

The analysts have been totally wacked on CMGI and similar stocks, agreed.
I just can't seem to draw rational correlations between most generalized
market behavior and CMGI's, or even CMGI's own behavior and that of the
analysts. We've been pressing the 52 EMVA for weeks, haven't broken it
yet, and analysts are cautious. What gives? Surely it's not
sustainability concerns e.g. ICGE.

> Unfortunately, stocks like CMGI have quite a bit of overhead supply
> to work through. While CMGI's price remained relatively stable, there
> was still a lot of high volume selling going on today. Usually,
> volume has to dry up before we can get a sustainable move upwards.

Yeah, I keep looking, and the bid/ask remains depressing. I wish Mulan
would come back to the CMGI board. ;-)

> Linda

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