whoa.. hold on. I love the short side also. There will be enough short plays to spare. Today a lot of 'scrap metal stocks' moved along with the good stuff, which is why some of the watch list had 'crap'.. as long as it went up, who cares? But as long was we know what the good stuff is and where the entry points are and support resistance we can know to hold through waves of continuing uptrends. Stock selection is only one part of the equation, good entries are the other part. How much potential upside? What are historical price patterns, etc? When can we buy the gap ups?
CORV, TIBX, EXTR, NUFO, ARBA, MANU, MUSE, ELNT, NEWP.. good stuff...after having shorted them for so long. All hit the pivot points like clockwork much like they did when they were long plays. Even NUAN was a buy.
ONIS, NUAN and AETH. Scrap metal still sells, I mentioned BLUE on the forum this morning and at least one picked it up. Not me, but someone else. So crap sells, especially when it is give a target of 55 and its trading at 7. However I don't own the a 'scrap metal' stock, just the good stuff. I don't even own a stock just some call options. But good ones. I will be getting some more call options but will not hold them past Christmas. Earnings pre-warnings begin even before Christmas so I would rather be safe than sorry. We did well these last two months on the short side and a few days so far on the long side. Some of us did so well we can actually take off by the 19th and just wait out the entire earnings season till the end of the year. I won't be trading a lot of issues because its quality and not quantity. Sometimes all it takes is a couple of stocks to fill your reservoir. The great thing about a rally like today is that some stocks that moved up 25% are going to be paying the piper in the next 3 days because they got into the 25% club without proper credentials and they will have to pay. Hopefully, we'll find them and make them pay.
Who am I to know what is a scrap metal stock? I don't.. I just have some criteria some of which are unsustainable multiple, very high captilization, narrowing market share, low earnings, price below 200 day moving average and closing in on the 52 or year lows, companies not earning anything (i.e. compare ONIS with AMCC or with ELNT).. you get used to finding them. When push comes to shove, you short the "ONIS's" of the world and hang on to the TLAB, QLGC, TLGD's etc. |
