There's a lot more than meets the eye here. If you look at the intraday price action, CRM sold off hard for the first 10 minutes. It turned around as the SPY turned around. The the two are quite correlated. CRM of course is much higher beta, but the patterns very much follow the S&P. My point on this is, had the SPYs not turned around today, CRM would not have gone up as much. You would think the "amazing" earnings news would made it move independently of the broader S&P average.
Another interesting note. Money flow for CRM came in at just under 1. Net money flow was actually
-$4.42 million. It was actually much lower than 1 (considered neutral) most of the day. Only in the last 1-2 hours of the session did it even approach 1. For most of the day, there were net outflows for CRM. Strange for a day with huge volume. This means there were sellers into CRM's strength. Sellers taking advantage of the liquidity shorts were providing. So, stock up 7.5% on volume more than 3 times normal, but net money flow is negative. Not a good sign moving forward in my opinion.
I believe that CRM will fade in the coming days/weeks. I suspect a big portion of the short float covered today, maybe as high as 30% of the shorts, taking the overall short flow to around 6%. With shorts around 6-7% (my guess), there will be less fuel to propel it much higher.
Thank you for sharing your insightful and intelligent, rational analysis. When the bough breaks, the CRM will fall...High beta and extreme overbought status, as also seen with LNKD and AMZN, will drop this 2-3X faster than the broad market when the bad times, finally, come...