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It was a lousy day on Wall Street on Thursday. The market needed to get some rest, and pull back and consolidate, which it did. There was a little bit of a bump at the end of the day, but I’m not sure how important that is or what it means. There are some interesting charts, both longs and shorts, that I want to show you. The biotech group may be emerging, but we’re at that point where we’re going to fly or die. So let’s take a look at some of those, some of our stocks that are standouts, and a few on the short side.
Cemtrex Inc. (CETX) is doing great. This is a 10-month high going back to September. The base was broken, it exploded, pulled back, each move on big volume, until recently, but it’s been etching up slowly on low volume, but with great technicals, a new high. On Thursday it jumped 32 cents to 4.79, or 7%, on 475,500 shares traded. The volume picked up a little bit, the best in about 7 sessions. I think the stock is headed higher. It could be a 7-dollar stock going forward.
eBay Inc. (EBAY) had a significant day on Thursday. It’s been basing for a while, a long while, but it’s actually been in an uptrend since 2009. On Thursday it popped dramatically, 3.59 to 29.93, or 13.6%, on 49 million shares, on a strong earnings report. That’s the biggest up-day in volume I’ve seen on this stock since 2014. I’m looking for an extension to get us to 32 short-term.
Stocks on the Short Side….
athenahealth, Inc. (ATHN) finally got whacked, dropping in after hours 1.38 to 137.20, or 1%, on 519,400 shares traded, to a low of 136.08, or about 16 points. It looks like if it follows through on Friday, we could see it down in the 112-115 range.
Stamps.com Inc. (STMP) was off about a percent on Thursday, down 67 cents to 72.73, on 945,000 shares traded. It looks like it has formed a bear wedge, and if it gets hammered from this point, we are going to see it in the 60-dollar range, or less.
Stocks on the long side included ProShares Ultra Nasdaq Biotechnology (BIB), Direxion Daily S&P Biotech Bull 3X ETF (LABU), VelocityShares 3x Inverse Crude Oil ETN (DWTI), ProShares UltraShort Bloomberg Crude Oil (SCO), eBay Inc. (EBAY), Freeport-McMoRan Inc. (FCX), CurrencyShares Canadian Dollar ETF (FXC), Direxion Daily Jr Gld Mnrs Bull 3X ETF (JNUG), Direxion Daily Gold Miners Bull 3X ETF (NUGT), Lannett Company, Inc. (LCI), Silver Wheaton Corp. (SLW), VelocityShares 3x Long Silver ETN (USLV), and Xencor, Inc. (XNCR).
On the short side, stocks included athenahealth, Inc. (ATHN), Cray Inc. (CRAY), Royal Caribbean Cruises Ltd. (RCL), Red Robin Gourmet Burgers Inc. (RRGB), Signet Jewelers Limited (SIG), Skechers USA Inc. (SKX), Stamps.com Inc. (STMP), and Zebra Technologies Corporation (ZBRA).
Days to cover is the amount of short interest divided by the company's average daily share volume. In other words, the number of days required to close out all the short positions. A higher number means more potential fuel to a stock’s rally as shorts cover, and thus accelerate the move, when the stock’s price rises.
On Balance Volume (OBV), developed by Joe Granville, is a running summation of volume on up-days minus volume on down days. OBV rises when volume on up days outpaces volume on down days -- and falls when volume on down days is stronger. A rising OBV reflects positive volume pressure that can lead to higher prices. Conversely, falling OBV reflects negative volume pressure that can foreshadow lower prices.