Rim Semiconductor Company (fka RSMI)

[tantra]

From Steve Harmon's Broadband News Hotline:
"Hotline: Profit Taking Slows Tech Stocks; Keep Stop-Loss Orders In Place.

Last year Warren Buffett likened the market euphoria to swimming naked. Well, this time around you at least need a Speedo or thong. In this Hotline we reiterate the 20% stop-loss protection.

As NASDAQ drops today on profit taking, we've seen this movie before: profit-taking after a substantial run in share prices the past two weeks. Starring investors who want more catalysts and don't have any clear ones given the economic data and the Federal Reserve's rate cuts.

It's profit taking in a market pause.

The first to take the hit are the fiber stocks since they often ran the most. We expect to see sideways or small trading range movement in NASDAQ, as the key barometer of the summer holding pattern. Summer is traditionally slow in technology but also a good time to carefully sift the opportunities.

In our analysis, the Federal Reserve rate cuts and President Bush's tax cuts won't likely be felt at the trickle-down level until fourth quarter 2001 at a minimum. While Wall Street priced in the cuts in the latest tech stock surge, we see the orders for new equipment, switches, chips, photonics processors, routers
and networking solutions won't likely start showing up until 2002. Real-world buying and selling doesn't move in Wall Street, Internet or CNBC time.

The coming buying frenzy for equipment to make networks faster, content multimedia and commerce instantaneous are all closer than we think but easy to ignore when the market has days like today.

The market has its Yin and its Yang. So we take a bit of both this time around. That's why it's important to think long term but keep trading techniques in place to protect portfolios. For those of you new here that means at a minimum have the 20% stop-loss order on each stock. This has its risk also since you could be stopped out on a wild trading day that swoons down and then soars up.

Using stop-loss orders means more work -- suggest your broker doing it, and make them accountable for doing it so no mistakes are made -- but also means more sleep at night knowing you're not naked to the market.

After each trading day or big run if stocks rise then set the stop loss 20% below the closing price per share that day. Ratchet up the stop-loss order so that
gains are locked in."

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