Michael Kors (KORS) — big breakout to all-time highs. So is this a "buy" or a "s..
Discussed in this article: Michael Kors Holdings ( $KORS )
We’re looking at Michael Kors (NYSE:KORS ) today. Here’s the thing though, I thought it would be a better short; I thought this would be a better short than it turned out to be. It was actually kind of a tough short all day today, but first let’s look at how this works.
I slapped some Bollinger Bands around this, clear out to four standard deviations, now three standard deviations should be containing like 99.9 percent of the closing prices, so that should be enough. But when the stocks trading up that high I’m thinking, “Well let’s just look at four standard deviations and see what happens there.” You’ll notice, by the way, this stock’s never been outside four standard deviations up here, so this was kind of a big deal, kind of like Netflix (NASDAQ:NFLX ) was, back in the day.
So we’re looking at Michael Kors (NYSE:KORS ) here and it trades up this high, but if you look at it intraday, the stock gapped up, traded around a little bit, but then it just didn’t sell off a lot. It trickled lower throughout the day, but man, it didn’t exactly implode, so this is actually a pretty strong stock, stronger than you might think.
So here’s what I’m suggesting, this is really the resistance for this stock, we’ll call it $85.00, this is really the resistance for this stock. If we have a roll over in the market I could see this potentially coming down to 85.00, $86.00, that’s really the time I’d be more inclined to be buying this. I’m short this stock right now and I will cover it if the stock starts moving to a new high, like if it starts moving above 93.18 then I’ll cover it. I’m a skittish short, I always have been, I can short stocks, but I just know that generally speaking the market tends to go higher and I’d rather be swimming with the current than against it, so I tend to keep my shorts short. So try this short with Michael Kors (NYSE:KORS ), see if it works. Ultimately the stock sure looks like it’s going higher, but for the immediate future, the next few days or maybe a week or so I could see this stock being fairly weak.