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Skullcandy, Inc. Message Board

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  • onepoint272 onepoint272 Dec 19, 2012 5:50 PM Flag

    Is this stock broken?

    Yes, I agree with 90% of what you say. Great discussion, thanks.

    You're right, I can't argue that there is a 50/50 chance right now, except that supply (selling) has dried up. But since demand hasn't proved itself yet with an SOS, the direction it is still up in the air and this could be a re-distribution trading range. But this 50/50 condition is irrespective of strategy.

    So no matter how you look at it, it comes down to picking a bias, bullish, bearish, or sideways; the last case requiring an option strategy.

    As for my bullish bias strategy, buying at the low of the range with a stop just below, limits risk because if it falls out of this range on volume (SOW) then the next stop is $6.75. And the reason to sell most at the top of the range on a lack-of-demand bar, or short-on-thrust bar is to take most of the bread along with some profits off the table just in case my bias is wrong. When a sign of strength (SOS) appears then of course it's off to the races. It may take a long time, I dunno, but in the meantime there is range to be traded for profit and longer-term stock to be accumulated with low risk.

    The range is roughly 7.91 to 9.04 or 14%. Even if you can capture $8 to $8.75 that is 9% and nothing to sneeze at. If you could do that 4 times that's 36%. And then if a SOW shows up and you get stopped out at 9% loss (at the most) you're still ahead. Of course if a SOW comes in right after your first buy then you lose 9%, but that's all part of the game, a far cry better than holding it down to 6.75. If an SOS shows up, well you're already in and off to the races.

    You said:

    "Remember Tom Payne, where is he? He had a silly following here on this message board and people asked daily "how high is this thing going", but he has dropped off the face of the Earth since the stock plunged. If the stock does rise most of these retail investors will again be asking "how high can this thing go" or "this is the short squeeze we have been waiting for". Then when the stock plunges again they hold until they are at a loss and then panic sell. The average retail investor will lose money on a stock like this if they are trading it for the short term."

    I cannot argue with that. There were clear indicators back then that it was time to exit and a shorter outlook and a little trading knowledge would have been beneficial to them. So much for being average. The average intent on staying average will always get fleeced and should stay out of the market.

4.07-0.05(-1.21%)Nov 30 4:00 PMEST