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Strategies & Market Trends : Roger's 1998 Short Picks
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To: George Acton who wrote (10918)7/3/1998 3:07:00 PM
From: Don Roberts  Read Replies (3) of 18691
 
George,

Look at ZITL 700 day graph ... specifically around the last week in Dec '96. ZITL was WAY overvalued at 30 ... and had very high short interest. ZITL shorts covered to take year end tax losses, which sent the stock from 30 to 72 in 5 days. I remember the day it crashed ... Dec 30, 1996. ZITL gapped up from 60-something to about 69, then continued up to 72 ... intraday it looked parabolic ... it continued down to about 65ish ... when it turned negative at about 3 pm, it crashed down to the low 40's or high 30's. It was a violent crash ... no buyers at all ... and the shorters chased it down.

That is called a blowoff top.

AMZN graph looks remarkably similar ... I am looking for a nice gap up, then a continuation upward ... I think that is a good sign to short, and I am watching it very carefully next week for the crash.

The only thing is ... there are so many damn shorts that have been screwed over by AMZN, that I think if it crashed 10 pts or so ... a lot would cover, forcing the price back up. Intraday trading during the past few weeks shows that the shorts are nervous ... any tiny uptick sends them covering with market orders... I am afraid this will prevent a full blown blowoff top crash for AMZN.

Anyway, ZITL is amazingly similar to AMZN. ZITL was the tulip craze of 1996. AMZN is the same for 1998.

Later,
Shortie
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