Is the price right on Priceline (PCLN)? Depends on whether you’re buying or selling. (August 07, 2015)
Here is a chart of Priceline ( NASDAQ:PCLN ). Look, I’ve never bought or sold a share of Priceline ( NASDAQ:PCLN ) in my life, but I’ve traded a boatload of options, calls, and puts. This is one of those stocks that has been spitting out money, certainly on Friday. I actually did a video last week talking about how to make money on Priceline ( NASDAQ:PCLN ) without just piling in and then letting the stock do what you think it’s going to do.
But here I’m looking at this and there’s certainly some selling pressure all day. I’m looking at 1350.00 as resistance. I don’t think this stock is going to get up above 1350, before it tests like 1300.00 of course, but probably like 1290.00 maybe even 1280.00, simply because this was kind of like a blow off here. A big, huge gap up, everybody’s got to rush, got to get in on Priceline ( NASDAQ:PCLN ) right away. Why? I have no idea, and now the stock is pulling back. If you look at the weekly chart you can see it’s a really nice volatility squeeze that spans back into 2013.
That’s fine, ultimately, I’ve seen the articles, I love it when these writers or technicians or what ever, they treat a stock like it’s actually a live person, “Can Priceline get up to 200.00? Does it have what it takes?” It’s really kind of stupid but that’s what happens. The point is that’s all longer-term stuff. Can it get up to 1500.00? I don’t know, probably. The way this stock has been going, it trades sideways for an interminable amount of time then breaks out; trades again for a long period of time then breaks out; trades again for long period of time then breaks out. So we are right at the beginning of this latest breakout.
So here’s my suggestion, stay away from this stock until it comes back down a little bit. If the market is weak, and it’s kind of getting that way, if the market is weak you’re going to see more selling at Priceline ( NASDAQ:PCLN ), we saw it all day on Friday, it’s just at right around 1315.00 or so, the stock never really fell below there. But ultimately this stock is going to come in a little bit more, that’s when you want to be buying this for a long-term trade. Or, do what I would do in a case like that, buy some long-term calls; just buy the top of the stock. If the stock pulls back go out to January 2016, even into 2017, if you’re a long-term guy.
Again, this is a stock, it looks like it’s ultimately moving higher, long, long, long sideways range. But shorter-term this is way over done. We can see it, everything is starting to unwind now. I think you just want to wait for a lower level before you want to get long this stock. Meanwhile there’s nothing wrong with being short, I am.
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