today's action thus far confirms my suspicion that institutions have been selling every time
P hits 29.80
for the fourth time it hit, and dropped, and today on heavy volume and a huge up market day.
i certainly the overall market wrong today, but P is now beginning to show a reversal in trend.
if the price drops again to the 28.00 level, i think it will be a serious indication of the need for
institutions to secure their profits, at which point the race down will begin.
not sure how long it will take, but as mentioned before, it think it will be before end of year
as the first ones out are already moving.
with such a huge institutional holding there is a huge downside here as they lighten up.
meanwhile, the retail investor will help the chart to move up slightly just before every major tick down.
the money flow is moving out, even on the day of the numbers release.
I'm a fairly disciplined retail day trader (I've been both long and short P in the same day many times...including yesterday). I watch this stock VERY closely. Yesterday, this stock ticked up slowly (to new short term highs above $30) on low volume. I was skeptical but I covered my short and went long above $30 (for a quick trade). I'm sure many other retail traders did the same and many new longs entered (as that was clearly a sign of short-term strength).
All in all, it's stock movement like this that makes it easy to see how retailers are generally on the wrong side of the trade. Volume is one of the best indicators and there is no doubt, today's sell off is backed by large volume. It's best to stay disciplined and take profits/cut losses.
I believe the selling starts slowly, and it has to in this instance, since there is not enough liquidity or even other institutions to sell to in block trades.
who the hell would buy a huge block of this stock at 30?
once the hands are shown (the volume is already 3mil in the first hour of trading on a huge market up day?) then the huge moves down will happen.
again, i believe the technicals have been showing money moving out this stock slowly for the past
sell a bit, let the stock move back up on nominal numbers and optimism.
sell a bit more...
once the buying drops out, nothing left to do, but sell or watch others do the same.
staying long is one thing...
long term if you want to hold this for a year or two, you could see a profit.
adding shares is quite possibly akin to adding shares of apple at 650.00
once the institutions start to unwind their positions when held this high, you could
well find yourself in a 40-50% retrace.
when looking back afterward, you ask yourself, why did i like a 10 dollar last year stock so much
when it got to 30.00?
and why does retail buy it at 30.00?
because the institutions and their analysts hype it all the way to up, again taking great gains
on the back of retail which is always the last one in.
i would suggest looking at a one year chart, and if or when this stock again hits below 25.00
(which i believe will be very soon), you rethink adding to your position.
the catalysts to the upside are few at this point.
the catalysts to the downside are quite many.
even the apple release has been taken as a non event at this point.
if that begins to change, and spotify begins to see growth, you'll see a serious change
i believe the spotify catalyst has the institutions seriously rethinking their position right now.