Micron Technology (MU)

[JLS]

The problem is ...

MU is a semiconductor memory stock (and nothing more) and that has the stigma of being a cyclical business, so its stock price goes through wild gyrations as investors try to account for the memory cycles.

Historically, during those memory cycles, memory companies would swing between periods of large profits and periods of large losses as the memory companies competed with each other within that cyclical market.

Most people who invest in memory companies are hesitant to start believing that it is going to be different now or in the future.

I have never called a "perfect trade" for MU. If I had I would have sold all my shares when MU was trading over $60. I didn't. I sold it at just below $44 in early September.

MU might start going flat here as there is plenty of support at this level during the 3+ month period of late 2017 and early 2018.

But MU has stated that they expect the next quarter to also be flat to down slightly; and they'll spend more on expansion so that will affect earnings a small amount; so after another so-so earnings report, MU could conceivably trade down to $30 during the first part of 2019. At that point I'll consider going back into MU.

Investing rule #1: the trend continues until it doesn't.

MU is in a downward trending channel.

Investing rule #2: don't forget Rule #1.