Many technology stocks haven’t performed well in recent weeks. And this decline comes despite the popularity of LinkedIn’s initial public offering and the rabid talk of other big-name Internet companies going public.
Research in Motion, the maker of Blackberry phones, has dropped 24 percent in just the last week, for example. Is a breakdown at hand? The chart signs aren’t good, Barron’s reports.
That applies even to long-time stalwarts such as Apple. That company has broken below its 200-day moving average, a key indicator for chart-based (technical) traders. When a stock suffers this fate, psychology can quickly turn negative toward it.
Facebook founder and CEO Mark Zuckerberg
(Getty Images photo)
“Bad news will matter, and this seems to be the case for Apple, writes Barron’s Michael Kahn.
Juniper Networks also has fallen below its 200-day moving average, dropping by about a third since February.
“While the stock decline of networking rival Cisco Systems was blamed on company specific issues, Juniper's fall tells us more about the sector,” Kahn writes.
At hot Internet companies like Facebook, even their own employees question the froth in their market value.
Some Facebook employees are leaving the company, which allows them to sell their shares on private exchanges, thereby avoiding losses if the company suffers a meltdown.
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“If you’ve seen the world blow up once, you just don’t know what’s going to happen a year from now,” a former Facebook employee told the New York Times, referring to the Internet meltdown of 2000-02.
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