This morning's action is the worst we have had so far in 2012. The minor bounce attempt was immediately turned back, and breadth is horrendous. Other than a few gold miners and some odds and ends such as Molycorp (MCP) and magicJack VocalTec (CALL), there is almost no green out there. Small-caps are being brutalized, and all the big-cap momentum stocks -- even Saint Apple (AAPL) -- are in the red.
Typically, a weak open has produced a Pavlovian response among dip-buyers, but they are cowering in the corner this morning as they wait for someone else to step up and provide some support.
It is not my style to buy weakness, so I'm not doing much so far. I prefer to buy stocks when they are going up and don't much care if I don't buy at the absolute low. What I do in an environment such as this is constantly refine my list of favorites and watch them closely for better technical action.
Tangoe (TNGO), for example is my stock of the week, and it has pulled back to support at $18.50, which is the pricing of a recent secondary. That is where it needs to hold, and I'll be watching that to see if it stabilizes and turns up.
Another that I'm watching is Vivus (VVUS), which has a weight-loss drug awaiting FDC action. If that can hold support at $22 and move above Friday's close, I'd be interested in pursuing it.
Lots of other small-caps are simply in freefall right now, and I see no rush to catch them. Folks who like to average into weakness may see it differently, but I'm going to stay extremely selective at this point and wait for better action before buying.
_______
Editor's Links
More Rev Shark:
