subject: Stock Newsletter -pt2 [print this page] Daily Stock Report for Tuesday Morning, March 30, 2010 pt2
Summary Opinion
All of the major indexes have surprised the January highs and has resumed its bull market run that started over a year ago on March 10, 2009. The current assumption is the bull run should continue to make higher highs after any pullbacks.
ABIO, Arca BioPharma, see notes under Focus Chart.
Focus chart: (Worden Stockfinder chart)
ABIO, Arca Biopharma had a premarket high of $8.80 and started turning over to $7.80 by 845am eastern time and that was the clear sign this was not likely going to make higher highs than Fridays high of $9.23. After the opening, ABIO hit $8.20 and immediately started correcting and bounced at $6.76 and peaked at $7.35. This is very typical of a bullshort that comes from $2.62 on Friday morning to $9.23 same day. For day traders, the play was to be short early and then buy long on that first bounce, which was an 8.5% bounce off $6.72. It was the first attempt at a bounce that didnt last more than a few minutes in which you had another opportunity to short at $7.40 (explained in tonights video). There are a couple of scenarios for ABIO now. 1) is a little pop up at the opening on Tuesday followed by a little selling and it could go to under $5 tomorrow BUT MOST OF THE SELLING HAS OCCURRED ON MONDAY so dont try to be aggressive by shorting it heavily tomorrow. The risk to reward ratio has changed and the odds will start going against you very soon. Dont chase it now, the train has left the station and already arrived at its destination.
The good thing about what is happening is more speculation is being seen now so keep a look out for these bullshorts. Look at other runners today: SERV, Servidyne went from $2.20 low to $7.24 today and was an outstanding short by going down from $7.20 back to $4.40 for a potential profit of 63%. FONR, Fonar Corp went from $1.42 to $3.81 today and sold off to $2.72 at the close. This type of trading action, or what I call runners in The Wizard Training Course, usually tend to come in the latter part of a bull run where people are confident (or overconfident) where greed is in full control with no fear in the marketplace. This is where we capitalize by looking to short these type of ideas, as many of you have seen in the last couple of years.
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