Cisco ($CSCO): Continue to trend down with GAPS

Cisco ($CSCO)  continues to trend down with gaps in between.

Since my last post in May, CSCO has fail to hold on and has go lower towards the $15 range.

News is out now that CSCO will cut as many as up to 10,000.

CSCO job cuts highlight the possibility of slow growth ahead due to economic activities and its internal innovation/transformation.

I believe, CSCO will hit $12.50 by Q1, 2012 (or maybe even earlier).



Cisco Systems Inc (CSCO): Gappy Charts and Bearish


Reuters just reported that Cisco (CSCO) will have a sales miss for this quarter with more jobs cuts expected.

The key points to note for Cisco is as follows:

1. Cisco’s core businesses is UNDER THREAT.

  • On the low end, competitors comes in the form of Netgear (NTGR), despite the fact that it owns Linksys.
  • On the high end, there’s Huawei from China.

In other words, there is very little room for growth in its traditional stronghold.

2. Transitional Period

Much has been said about its transition. While Cisco is pretty much cash rich, with little debt, there is no guaranteed that the transition will see light.

Just not too long ago, the newly acquired FLIP was dumped.

Traditionally, Cisco is used to selling hardware (routers, switches etc). The transition may mean more services and that does requires a change in approach.

3. Ichimoku Chart for CISCO (CSCO)

Nonetheless, we can see from the Ichimoku chart above, CSCO has at least 4 gap down May 2010 when it break the kumo support.

The trend is clearly bearish. With more cost cutting expected, I won’t be surprised if it can touch $15 or even $12 if the overall market turns bad.



Radware Ltd (RDWR) : Bearish Cross Sighted

Despite beating the earnings estimate, Radware continues to face selling pressures after its earnings has been announced.

With the continuous selling, a bearish cross is sighted after it break the 2 support level at $22 and $21. I have since sold off my holdings at a loss after it breaks $21.

Currently, the price close right above the kumo support.

Personal Lessons:

A mistake that I make for my recent RDWR trade was not setting an auto stop-loss in place.

Not only that, despite I did make a profit prior to the earnings results, I was not willing to take it off the table; trying to bet that Radware will beat its estimates and it will go higher. The results : It went down.

In short, my lack of discipline and greed cause my loss for this trade.

Reminder : Always have your stop-loss in place

Reminder : Follow my chart reading strictly.