Still Worried, Tech Investors Look for New Strategies

For example, CNet is soaring toward a new high, but it could be ripe for profit-taking.
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SAN FRANCISCO -- Despite the recovery of technology and Internet stocks, market players still worry about a major correction that will be sustained for longer than one day.

Greg Nie, technical analyst with

Everen Securities

, sees Internet stocks heading for a short-term peak within the next week and suggests new strategies to take advantage of the current volatility. He says if a stock trades to a new high, an investor could become a "partial seller" of the issue to book some profits, with the intention of buying back the stock when it does sell off. If the stock does not make a new high, he suggests closing out the trading position. One exception, he said, would be those stocks seen as core holdings such as

Yahoo!

(YHOO)

or

America Online

(AOL)

, which are more longer-term plays.

Internet media company

CNet

(CNET) - Get Report

is a good example of what Nie means. The stock traded to a high of 159 1/2 April 13. After blowout earnings and an announcement of a stock split after the close Wednesday, CNet soared to a high of 155 early today. Though it still could eclipse the April 13 high, it fits Nie's pattern of a stock that is ripe for a bout of profit-taking.

Another candidate could be

Amazon.com

(AMZN) - Get Report

, which reports earnings April 28. Trading in the 180s today, it has potential to split. But note that it is already relatively close to its all-time high of 199 1/8 from Jan. 8.

Inktomi Inks a Deal

Inktomi

(INKT)

announced an agreement to gobble up

Impulse! Buy Networks

, a 2-year-old online merchandising start-up based in Burlingame, Calif.

Inktomi will acquire 100% of the outstanding stock and assume all stock options of Impulse! Buy in exchange for 900,000 shares of Inktomi common stock. At yesterday's closing price of 125 1/2, that puts the value of the transaction around $113 million.

Inktomi says the acquisition complements its new shopping engine, which the search-engine and data-networking technology company is hoping will generate oodles of new revenue. Inktomi shares were trading flat to slightly higher this afternoon at 126 3/8.

-- Spencer E. Ante