Tag Archives: short

Baidu (BIDU) – Wall Street Darling No More

Today officially marks the end of Baidu (BIDU) as the once loved wall-street darling that rose 1000%+ from the 2008 collapse... at least in my book. It used to be a stock every hedge fund owned and every analyst had buy ratings with lofty price targets. Today Credit Suisse downgraded the stock and reduced it's price target from $118 to $83, which is the lowest price target on the stock right now. I think that will change as analysts will continue the trend of downgrading the stock on competition and market share concerns.

Folks bearish on the stock have been raising their bets on future downside, as 8,494,038 shares are currently short and is an increase of over 1 million shares from the month before. I expect that to increase 3-4 fold in the coming weeks.

We are betting on a quick move under $100 for Baidu(BIDU) this week, as the selling pressure increases and shorters continue to increase their bets. We currently hold the 100/95 weekly puts and the October 20th puts. Baidu(BIDU) can be a very volatile stock, so be prepared for some wild swings here but to me it looks like the 3 week battle of bull vs bear has been decided with a decisive victory coming from the Bears here shortly.

Baidu is trading at $106.32 as we write this.


AAPL – What On Earth Happened Yesterday And Where Will It Go Next?

By Chris Diodato

Following up on my post on Monday, available here (make sure to follow us if you have not already!), it looks like Apple decided to run into a wall at $675 on the intraday, and might have hurt itself.  Check out this video for the current analysis, including Japanese candlestick, volume, and Elliott wave analysis.  Also, new support levels are detailed.  Happy trading!

“Hold the line!!” – SPY

It was November 30, 2011, when the world's Central Banks united to ease strains on the global financial system. This move marked the end of a very turbulent summer and fall, where markets fell across the globe on fears of a Eurozone debt crisis.

Seven months later, we find ourselves in a similar situation. You know how the saying goes, "Those who don't learn from history, are doomed to repeat it". Will it be the bears who were taken to the woodshed betting on governments to sit on their hands? Or will it be the bulls, betting on more intervention?

Where will folks put their money with treasuries at all-time lows and negative Bond yields. Silver? Gold? The Dollar? It's almost like governments are forcing folks into equities. Time will tell, but I will continue to be a short term bull into we close under $127.90 on the SPY.



The Crossroads – Where are we headed?

On April 4th, the market hit a 4 year high as the $SPY touched $142.21. If you had told someone last October that the market would be up nearly 40% 6 months later, they would call you crazy. But that is exactly what happened from the 107.43 low on October 4th. Amongst all the negative sentiment, the market mysteriously found a bottom and rallied furiously, squeezing all the bears... the ones who watched the riots in Greece with glee, the ones who were hoping for someone else's pain to give them glory. We have seen this story over and over. The Eurozone debt situation is not a new problem. The market has been dealing with it for 3 years. We have seen this before, and it will not be the cause for a larger sell off in equities. May's decline has been somewhat orderly. The trading days have lacked the 1-2% swings we became accustomed to in August and October. This is no panic sell-off, its profit taking.  Yes, the USD has been on a major tear, trading up for 14 straight days at one point... the most since 1985!

Looking at that data point alone, I woud assume the markets had a massive sell-off. Yet we are not even in 'correction' territory. It's buy the dip time for me. With the election coming, there is no way the market is allowed to fall any further. Well we shouldn't call it a market, since the Obama administration will pull out all the stops to ensure the "economy" is not the cause for Romney winning. And to make that happen, we will need to have a nice summer rally.

Best way to make money trading, is to be ahead of the curve. Here is what I am doing to ensure I am:

Expect some "buy the pullback" upgrade to come out on your favorite momentum stock. Stocks like Priceline.com(PCLN), LinkedIn(LNKD), Buffalo Wild Wings (BWLD), Panera Bread(PNRA), Chipotle Mexican Grill(CMG), Intuitive Surgical(ISRG), and Starbucks(SBUX).

Buy out of the money calls on those plays to maximize the impending short squeeze. The dumb sheep are the ones who are shorting it based on the chart, and will be covering when they start getting squeezed.

Second, expect some sort of China stimulus. They are missing the talks of their growing economy and want to be back in the spotlight. China can be the key for a nice recovery alone, and China sure knows how to manufacture fake growth to inspire folks to load up on China stocks like Sina.com(SINA) and Baidu(BIDU) as well as the oversold commodity stocks.

We will have more on our watchlist tomorrow, but we are banking on a nice rally coming in the next few weeks. By the time you blink, we will be back over the April highs. Most folks will be scratching their eyes wondering what happened. Here at OptionMillionaires we will be counting our profits.

Take a look at the chart below. Lets have a great week!!!

LNKD – Just like the Doctor ordered

Back in the day, an upgrade from Goldman Sacks was a welcome sign for a company and investors alike. The conviction buy list actually lived up to the name. Recently it seems Goldman Sacks has lost its luster. Stocks it upgrades fizzle... the conviction buy list?? Isn't that the daily read in the New York Penitentiary?

Goldman Sacks finally read this blog. LinkedIn(LNKD), which is up from  $64 in early march, eclipsed the $100 barrier today on an upgrade from the once relevant investment firm. We have been writing about this stock for weeks. Read here.

It didn't take overpaid analysts to see the bargain on LinkedIn(LNKD) shares. It must mean Goldman Sacks(GS) finished loading up on some shares. Fully expect this manipulated stock to cross and hold the $100 barrier for good sometime in the next 5 days.

We said it would break $100 last week.. a 10% move. Well no more then 7 days later, the stock obeyed our orders. Option traders reaped the rewards today. Take a look at the charts:





 LinkedIn(LNKD) continues to shine after its most recent earnings report, dilution none-with-standing. Expect a consolidation day or so, before the lock and load above $100. Or maybe you should ask the folks over at Goldman Sacks(GS), they seem to have "casually-late" down to a science.