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Skullcandy, Inc. (SKUL) Message Board

  • onepoint272 onepoint272 Feb 18, 2013 12:59 AM Flag

    The onepoint272 Fib Extension = $5

    $5 is a psychological number that can't be denied. SKUL has already broken into the fives, hitting a low of $5.98. So it's just a matter of another 16% plunge to that magic $5 number, which is nothing in the whole scheme of the 74.4% run down to date. In fact at $5 the total discount from the tippy-top is only 78.6%; not much different than 74.4% accomplished already. But not only that........

    The high of the IPO week was $23.40 in July of 2011 whereupon it essentially fell straight down to print a low of $11.81 in Oct 2011. It then went into a declining wedge putting in consecutively lower highs in Nov 2011, April 2012, and August 2012 until it finally broke thru the $11.81 ice on Nov 1st, 2012. So what you have is one big ABCD pattern with an A-point at the high of $23.40 and a B-point at the Oct 2011 low of $11.81, and a C-point at the Nov 2011 high of 19.75.

    The A to B drop was 23.40 - 11.81 = 11.59. So if the ABCD-down pattern was to be confirmed you would expect the C to D leg to at least equal the A to B leg. So taking the C-point price of 19.75 and subtracting the same 11.59 drop gives a projected D-point price of $8.16. Well it fell thru that price, the 100% extension of the A to B leg. And it's no wonder because on a weekly basis it broke thru the $11.81 ice on 3.45M shares compared to only 1.73M shares at the B-point, the 11.81 low in Oct. 2011. It was almost exactly twice as much volume. You see it had been building cause for about one year, building cause to go lower. Not only that, but when it broke under $8 it did it with 7.14M shares in early Decmeber 2012. (As a side note it was not surprising that the institutional ownership shrank from 75% to 51.5% as of Dec 31st 2012. However, the short interest shrank to nowhere near that degree.)

    So now that it has fallen thru the 100% level and can't get up, where is the next likely level? Well, it's my favorite Fibonacci extension, a 1.272, or 127.2%. If we take the A to B drop of 11.59 and multiply by 1.272 we get 14.75. Then if we subtract that from the C-point of 19.75 we get: 19.75 - 14.75 = $5.00.

    The last decent bounce on this was the "last point of supply" in September 2012, and it's been downhill ever since. So if we look at the ABCD inside the larger ABCD discussed above we have an A-point at 16.75 from August, a B-point of 11.84 in Sept, and the C-point at 14.58 in Oct, the last point of supply. The 100% extension would have put the D point at 9.67. We crashed thru that. The 1.272 extension was 8.33 and we blew that away! The 1.618 extension was 6.64 and that got blown away with 5M shares. The next level then is the 200% extension which puts the D-point at $4.76.

    So, cheer up, we should see good support between $4.76 and $5.00.

 
SKUL
8.31-0.35(-4.04%)Apr 23 4:00 PMEDT

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