New addition to the Nasdaq 100 looks like a buying opportunity to me. Let’s look at Green Mounta..
Discussed in this article: Green Mountain Coffee Roasters Inc. ( $GMCR )
I want to talk about Green Mountain Coffee Roasters ( NASDAQ:GMCR ). This is a company with 38 percent, almost 40 percent of the float in the hands of short sellers. They borrowed the stock, sold it hoping to buy it back lower; that’s probably not going to happen.
Last week it was announced that Green Mountain Coffee Roasters ( NASDAQ:GMCR ) would join the NASDAQ-100, it would be a component of the NASDAQ-100. That is going to actually be in affect this coming Thursday. Now, don’t think, “Okay well then on Thursday this is going to have a big pop.” That’s not the case, this will have already been happening, as far as funds that track the NASDAQ-100, they’ll have already been accumulating this.
But keep in mind this is some pretty formidable resistance here. If Green Mountain ( NASDAQ:GMCR ) starts trading above $80.00, it was trading above that level earlier today; if it closes above that level I’m looking at this as a probable breakout and would see the stock move a lot higher.
Look, the market is definitely in or close to correction mode. There are a lot of stocks that look really, really ugly. This is not one of them, and I think a lot of that is because of the high short interest. You’ve got this natural floor under the stock where with any kind of pullback you’re getting folks who want to buy this stock so they can close their shorts out.
So I think you’ve got to just stay long this stock, be patient. Look at this uptrend, this stock’s gone up since bottoming out in the middle of last year. It’s not quite up to a new high, but we’re not really thinking about that right now. All we’re thinking about is this sideways consolidation, let the stock do what it’s going to do, but if it starts trading above $80.00, you would probably be a little bit early because the real high, back here, is 82.00 or so, but I would say if the stock starts closing above $80.00 go ahead and buy this stock because my bet it is that it will continue to run.