Netflix has been the #1 momo stock for the past few years. Recently, its ascent began to accelerate at an unsustainable pace. When a stock begins to behave like this it is time to look for low risk high reward entries on the short side. Here are a few things you can look for as clues when to open the … Read More
The Analyst Downgrade Bottom–Micron
When a stock has been in a longer term down trend there are many ways that it can put in a tradeable bottom (assuming it isn’t a commodity stock in which case it may just file for bankruptcy at some point). The fundamental cause of its down trend goes away. This is what happened in Apple in 2013 after its 40% … Read More
“This Stock Is Going To Zero”
Yesterday we started looking at SUNE as a good bounce candidate. Since issuing a profit warning the stock had sold off over 50% in a matter of days. We had been receiving pretty good news flow that large buyers began accumulating the stock around $16 and as it approached its 52 week low our expectation was that it would bounce … Read More
Twittergeddon!
The after hours price action in TWTR was epic. The market had been anticipating a large move following its earnings release based on how pricey its options contracts were prior to the announcement. And TWTR certainly didn’t disappoint. After closing the regular session at 36.50 it traded above 40 when its earnings were released. It beat on both top and bottom line … Read More
Today’s Top 2 Trade Setups–AMZN & TEVA
This morning we were setting up for a very busy day. In addition to the market continuing its slide from last week — there were a multitude of In Play names and Second Day Plays from Friday. Our #1 ‘In Play’ idea was related to TEVA which had agreed to purchase, in a mostly cash deal, the generics business of … Read More
Study Price Action & Stop Being A Silly Troll
Back in April I tweeted a picture of a SPY chart that I thought was rather instructive. Here is the chart: A few things we can take away. The first is that the SPY 204.30 had been tested in February and then again in March. The bounce in March was very fast moving from the low to SPY 211 in … Read More
A Few Trades From Today
We are in the thick of earnings season now. It is time to perform. Here are some stocks that were stocks that were discussed in our AM Meeting. The format of the meeting is Big Picture (discuss indexes), stocks with fresh news catalysts and likely trading patterns and conclude with Second Day Plays (key levels identified from prior day’s trading) and … Read More
Netflix Reported Earnings–This is What Happened Next
I have been trading “momo” stocks for almost two decades. What makes stocks like NFLX, TSLA and FB so enjoyable to trade at times is the almost monolithic behavior of their large investors. This behavior greatly increases the risk/reward for short term trading setups. That is why I always spend time covering these stocks in detail in our AM Meeting … Read More