STEC has dropped from around 42 to 26 within just 2 weeks. There are different kinds of rumors floating around about the steep and fast drop. One is that there is increased competition from other solid state driver makers such as Pliant Technology.
I believe that was just a trigger to the crash since STEC moved up too fast and there were a lot of profitable positions ready to be dumped at any moment. But the drop is a bit exaggerated. This is trading. Fear and greed is everywhere. Due to this type of market exaggerations, there exist money making opportunities. We, as short term speculators, are like vultures that fly wherever there is a possible meal. I really like the vulture analogy when it comes to shorting. It is a win-win scenario where you get a nice meal and clean up the environment at the same time.
I believe we might see a bounce very soon in STEC. Will it make a new high? I neither know nor care. What I care is if it can have a quick bounce of 20% from here. Technically speaking, STEC is still in its uptrend. And theoretically, every dip of an up trending stock is a good opportunity to buy. In addition, the little green bar on the daily chart looks like a bullish morning star to me.
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