Investing in the Technology Sector
‘Tis the season for the technology sector (most notably consumer electronic stocks in the sector) to move higher in anticipation of strong sales during the Christmas season. Seasonal influences on technology stocks are expected to be particularly strong this year. Research in Motion is one of many technology companies that are launching several important new consumer electronic products for the Christmas season. Apple announced lower prices and upgrades for its iPod and iTune products. Also, Apple’s recently launched iPhone is expected to be one of the hottest products this Christmas. Microsoft announced last week a price reduction for its Xbox in anticipation of strong Christmas sales. Several computer game companies have recently announced new products that are expected to be on sale this Christmas. The technology sector has a history of moving higher from the end of September to the middle of January. The period of seasonal strength historically ends just prior or after the annual Las Vegas Consumer Electronic Show. The trade has been profitable in 8 of the past 10 periods for an average gain per period of 10.1%. Short term momentum indicators for the sector have yet to show signs of a seasonal entry point this year. They are oversold, but need more evidence that they have reached a bottom.
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Last edited by Airelon : 09-14-2008 at 12:34 AM.
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