"Is it safe?" — Laurence Olivier (Dr. Christian Szell in "Marathon Man")\ L..
Discussed in this article: Intuitive Surgical Inc. ( $ISRG )
I want to look at Intuitive Surgical ( NASDAQ:ISRG ). This is a real interesting dynamic here, because here’s what happened; this is a big ugly reversal, if you bought today you’re not particularly happy. The least you could’ve lost would be like six cents, if you bought at the open and sold at the close.
This is an intraday reversal of really ugly and massive proportions, but this is what happened; yesterday some research house, and I’ve heard the name, but I don’t know who these guys are, William Blair, some research firm wrote a bullish piece on Intuitive Surgical ( NASDAQ:ISRG ), that was yesterday.
So the stock moved up, essentially as I understand it, they’re talking about how wonderful the da Vinci Device is, and all that, and that’s great. So like lemmings everybody’s running in the same place yesterday, which is why the stock was up even though the market was weak. Then look what happens intraday today, this is interesting.
This is one of those things where you’ve got to think about trading places, where all those traders are looking around like, Oh, the Duke brothers are trying to corner the market, something’s going on over there, let’s get in on it, they know something. This is kind of what happened here are today.
So the stock was up most of the day yesterday, kept going today, until magically, at what time was this? It was 10:50, we’ll say 10:55, the stock started to reverse, this was pretty high volume here, but then the stock really started to reverse. So what happened? Well, I looked at the news and on Yahoo Finance, as well as any other news aggregate publication, Barron’s published an article, 11:05, that was a really bearish piece essentially saying, William Blair, that’s great dude, nice job there Chuckie.
But what we’re really talking about here is safety, are these things really safe? The answer would be a no. And so for the rest of the day after that article came out, more and more sellers were dumping this stock, and then what happened at the end of the day? There was one of the biggest volume spikes of the day. So this is a stock now, if you’re long, sorry, it’s not going to work for you. This is not a stock that I would short because it’s essentially just come right back down to support here.
The reason I wanted to show you this stock was just to illustrate what happens intraday. If you’re trading these stocks, these iffy stocks, the stocks that really are just not good stocks, and this would be one of them. If you are buying them you’re going to have to watch that trade for a while, you can’t just get nonchalance and say, “Good, I bought at the bottom and now the stocks rallying intraday. I’m going to make a gang of money on this, $360.00 up to $400.00;” back down to $381.00.
So stay away from this stuff and all of your stocks that you’re not 100 percent confident on, at least manage them intraday. Make sure that you’re looking at all the price levels, and when you see something goofy happen like this, when you see this start to peel off, look at the news see if there’s something that came out, a lot of times the answer is no, there’s really nothing that came out, but you’d be amazed at the number of times where, when you look at a sell-off like this, you won’t get in on it at the exact top, but you will be able to get in on it pretty early.
Another example of this would be Carl “the tweet” Icahn’s deal on Apple ( NASDAQ:AAPL ). That was one of those things, Apple ( NASDAQ:AAPL ) started breaking out, nobody really knew what was going on until finally somebody said, “Oh, Carl found a Twitter account.” So you want to be watching these things intraday, believe the move verify it later.