3 Stocks I Saw on TV (VRX, JPM, FANG) (July 13, 2016)
VRX JPM FANG GOOGL NFLX AMZN GOOGL FANG
Every night we watch the same shows, Fast Money and Mad Money, and we want to USE those ideas the grow OUR money. Well good trading takes more than just writing down the tickers you see on TV every night, to buy them the next morning, okay? I’m here to help you make money on THESE 3 stocks I saw on TV.
They were talking about Valeant ( NYSE:VRX ), among many other stocks on Fast Money. Is this is a zero? I think it’s the CEO, I don’t even know. This is TOTAL monumental disaster from about day here, is selling a bunch of stuff. The bottom line is, these are all rats leaving a sinking ship, and it’s been sinking for a while. I think the last of the rats are leaving. The issue is, they’ve got such huge litigation risk. Who what’s to buy this stock, other than shorts that are kind of covering early? I would say, nobody. My suggestion is, if you’re looking at this like, “I’m going to get this on the cheap.” Seriously dude, don’t go that way. I would probably be a little bit careful about shorting this stock. But frankly, what do you think is going to happen? The stock is going to move back up to $40.00? I don’t think so.
I would just be careful about position size. But if I HAD to either buy the stock or short the stock, I would short the snot out of this thing in a heart beat. I don’t HAVE to choose, neither do you. So what I’m suggesting is you totally stay away from it completely. Don’t be in there buying this stock on the dip. And by the way, 66 million shares were traded on Wednesday. Each one of those shares had a buyer. So there ARE buyers for this stock. But I’m just telling you, you want to error on the side of being an aggressive seller. And if you’re shorting, keep you’re position small, or COVER it by buying out of the money calls. Have some kind of hedge against your short position. But frankly, I think this could be $21.60 above support.
Now, JP Morgan ( NYSE:JPM ) reports tomorrow morning. Depending on when you’re watching this, you’ve already seen the numbers. Cramer was talking about this, and his point is, as long as the Feds going to keep interest rates low., and I’m 58 so they probably won’t raise them in my lifetime, it’s going to be hard for banks to make money. Cramer was a little bit wishy-washy, frankly, on whether you buy or sell the stock. I think he was just more talking about the dynamics. My suggestion would be this: Lets say they report disappointing numbers, this is NOT the kind of stock that is going to gap down and then keep on going. It’s JP Morgan ( NYSE:JPM ) and you’re going to have traders that will be buying this stock on dip.
So I would say, I’d say this, it’s actually pretty simple. First of all, there’s not a lot of upside, because they can report the most awesome numbers in the world, but rates are still low and they’re going to have a hard time making money. So if the stock gaps up I would be selling into that gap. I would absolutely look at this as resistance that’s probably going to hold and I would sell into to that. Not necessarily short, but I would definitely unload what I have. On the other hand, if the stock trades lower, if it gaps down, I would want to BUY that. I don’t think the stock is just going to continue to move lower, so you’re buying anywhere down here. That’s the way I’d trade this.
And then the last thing is Diamondback Energy ( NASDAQ:FANG ). Cramer was talking about FANG versus FANG, the energy company here versus Facebook ( NASDAQ:FB ), Amazon ( NASDAQ:AMZN ), Netflix ( NASDAQ:NFLX ), and Google ( NASDAQ:GOOGL ). His deal was, look, these things aren’t doing that well. Netflix ( NASDAQ:NFLX ) hasn’t been doing very well for a while. Amazon ( NASDAQ:AMZN ) drifting a little bit lower, but guys, it’s run by Lex Luthor. Ultimately this is going to move higher into earnings. And then like I said, Google ( NASDAQ:GOOGL ).
So Cramer thinks that frankly, the better bang for the buck is FANG ( NASDAQ:FANG ). I tend to agree with that. I first started covering this stock a long time ago and it wasn’t because I particularly liked the company. It was because I thought the name was cool like Diamondback Energy ( NASDAQ:FANG ). But look at this here, you’ve got resistance, you’ve got support, you’ve got earnings due to be reported on the first week of August. I would look for a breakout above here, and that’s when you want to buy this stock.
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