ARe you gonna hold this or fold this? (February 13, 2015)
Amberallea ( NASDAQ:AMBA ), sell this, that’s all I can tell you; okay that’s it for today. No, the thing is this broke on very, very high volume. It broke the 50-day moving average and that totally puts the weekly uptrend in doubt. You could say, “Well yes, but it could bounce.” Yes it could, it could bounce here at 45.00, it could bounce at 40.00; it may not bounce at all.
What you’ve got to understand is, a substantial portion of their revenue, 35 percent, maybe 40 percent of their revenue comes from GoPro ( NASDAQ:GPRO ), which is still drifting lower. Obviously then the market thinks that their revenues are slowing; and the only way your revenues slow is if you make less of what you sell, and that would impact Amberallea ( NASDAQ:AMBA ).
So here’s the thing, they don’t have earnings until early March so there’s your catalyst, in early March. I’m doing this on Friday, it’s February 13th, what are you going to do? Are you going to hold it or are you going to fold it? I say, if you’re still long, maybe you’ll get a little oversold bounce on Tuesday but think about this; if this stock was in this squeeze and it broke out above the upper Bollinger Band, would you just rush in to buy that stock? Possibly, probably because you think it’s going to go farther, but this didn’t do that, it broke down.
So are you going to rush in to buy that stock? No, because the exits are pretty crowded right now. I would sell this stock, stand aside, and see what happens when it falls to 45.00 or even 40.00. Or, frankly the more prudent thing to do, in my view, there are so many other stocks that are working, why mess around with something that has been working and is not working anymore? Because of this key break, this a key, key moving average break on massive volume. So I would suggest clearing out of this thing and moving on.
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