Quotable swing trader, Alan Farley, at Hard Right Edge, noted in his Morning Trader space tonight:
Retailers got hit with a selloff at Monday's open, dropping the SPDR S&P Retail ETF (XRT) to a 6-day low. It bounced in the afternoon but showed relative weakness into the close, with department and big box stores leading the downside. Kohl's (KSS) dumped over 3% in the mini shakeout while Target (TGT) and Costco (COST) closed in the red. This rotation could be significant, coming on the first day of the new expiration cycle.
It's also worth noting that the whole consumer cyclical sector cracked today and closer to home, HAR is set up for an ABC-Down.
Best Buy, a retailer of Skullcandy headphones, printed a huge decline last week with a wide gap on huge volume, seems to have found some ground this week, albeit mushy ground with no meaningful reaction, is a good looking short on the deadcat bounce. The story for Best Buy is not good; revenues can't support the real estate. They're likely going to a smaller footprint like Radio Shack and Sears with more limited shelf space.
What will be the impact to Skullcandy? Drop it? Limit models. Demand higher margin for BBY ~ lower for Skullcandy?
S&P should open red this 4/4/12 morning and complete a measured move down in the AM. Looks like the same set up on SKUL but waiting for stopping action on this evil trend before shorting. Unless of course another shoe drops; 60 zillion shorts can't be wrong. Getting close now.
Okay, so now BBY is discarding their CEO. The talking heads are all over this. I love the way price leads the news.
Just another short opportunity developing.
New CEO should shake the tree and get rid of those low margin items, bad-for-your-image products.....like Skumcandy.
John 'Jetblue moment' Farmer,
Do you actually talk yourself into believing your own crap? Best buy is closing 50 out of over 1,000 units. They are adding ~75 mobile stores where audio gear of some type will be sold. So perhaps best buy will sell more skullcandy in 2012 than the prior year. You see they have a buyer that probably recognizes the strength of the brand and isn't likely to swap it out for some trend riding small fry looking to make a quick buck in audio.
Small footprint radio shack sells plenty of skullcandy. You don't think apple, best buy and radio shack demand higher margins already?
'60 zillion shorts can't be wrong'
Really? Heavily shorted shares always lose out? What a foolish statement. Plenty of companies are up 5 and 10x that have had high short interests the entire time. Sure some get whacked as well. Point is shorts are no smarter than any other group out there.
I buy them 3 to a pack for $9.99 and wear them under a real shirt.
The grains were up big today, wheat, soybeans, and corn. Corn was limit-up. If you don't trade futures you can get into corn using the Teucrium Corn Fund, ticker CORN.
(CORN does not demean women nor inappropriately exploit children in the marketing of their product)