So you should see by now that I like to play stocks that I’ve been watching for a few days. I don’t try to predict news, I don’t try to predict how businesses are doing and I certainly don’t try to predict anything related to the economy; all I care about is how people PERCEIVE a stock’s news and people’s PERCEPTION of how their business is doing. Perception creates patterns and these patterns are PREDICTABLE because they are based on human nature. I will repost this line again and again because it’s so incredibly important to understand:
“Wall Street never changes, the pockets change, the stocks change, but Wall Street never changes, because human nature never changes”
– Jesse Livermore
With that in mind, check out these other stocks I’m watching:
(Nasdaq: ASTI) broke out to a new high late Friday afternoon, finishing up nearly $6/share to $26.75. All of the gains came in the last 2 hours before the market close and this is why it’s sooooo dangerous to short these solar plays. Sure, sure, with a $200 million marketcap and only a million or so in expected sales this year (that’s right, it’s trading at 200x forward sales, 680x current sales LOL) many think it’s overvalued (it is), but short sellers forget to look at the more important numbers: 4 million share float, 1.2 million shares short. 25% of all shares are shorted, short squeezes will happen, and as I’ve posted again and again, Fridays, particularly Friday afternoons, are perfect for short squeezes. It only took 2.2 million shares traded to squeeze it up 25%.
So, why wasn’t I long? Because it’s tooooo scary, there’s NO way to tell how long short squeezes will last, especially overnight. So, my plan is to wait for it to all end and then look to short in the $30 to $40 range. Along with (Nasdaq: ASTIZ), I’ll be looking to short next week. Looking at the chart, this is a perfect cup and handle breakout, but the stock has already had this kind of breakout before and that failed, so I expect this to fail, too, possibly. (Each time a stock breaks out anew, the likelihood that the pattern will repeat in the same manner decreases).
(Nasdaq: CHINA) has been battered over the past few months and people gradually realize this company doesn’t live up to the hype and lately tax loss selling – I’m sure – has had something to do with the decline. Friday shares got a boost from some share repurchase program, I think it’ll fade, ideally, we’ll get some more strength to short into. Lots of resistance at $6, so if I can get a short off anywhere near there – a longshot to be sure – I’ll take that.
(NYSE: MBI) The stock of these liars hit a new low, down 16%, too risky for me to short over the weekend, we’ll see how the chart looks Monday, could be another short.
Reminder: I can post my little lessons and stocks I’m watching all day – and I will – but if you really want to learn about my strategies, check out my 6-hour instructional DVD, full of charts, actual trades and lessons learned, all of which comes with a 220-page instruction manual and autographed book. And because I know you’ll be surprised at how much you learn and how surprised you’ll be that I’m not full of it (like 99% of “market gurus”), it comes with a 60-day money-back guarantee (minus a little restocking fee because it’s a bitch to restock).
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