Looking for a meal? Don’t use Grubhub (GRUB). (October 04, 2018)

by DAN GRUB 
This chart of GrubHub ( NYSE: GRUB ) pretty well sums it up. GrubHub ( NYSE: GRUB ) is kind of representative of SO many stocks in this market; that is, it has been a tear this year; it doubled this year. Now, though, it has been kind of tapering off for a while and has finally fallen below the 50-day moving average on volume. The volume is actually picking up here today.

So here’s the deal: This is pretty simple (my videos are going to be short tonight because people hate to look at stock market videos when the stock market looks like it does now), you need to sell this. If you are long, go ahead and take profits. If you are looking for something to short, frankly, I think the ideal short entry, on a stock like this, is like this. Simply put, this really isn’t your short entry; it is not a real safe one. The idea is you want to short a stock that has broken down and this has.

You are looking for it to rally a bit and then roll over. It is like a trendline break or here the 50-day moving average break and then the attempted recovery to kind of get back in the range here. If it doesn’t do that then that is your short entry. If you are doing it now it is really kind of tantamount to chasing a stock, in this case chasing it to the downside.

No matter how you make this trade this is what I don’t want you to do: Just don’t buy this stock; this is not your trading opportunity. If you are a GrubHub ( NYSE: GRUB ) user looking for an entry you could say, “Okay, this is the best entry I have had in a while.” This is not that, so get away from this stock. I have a very, very large cash component in my trading account and by tomorrow it may actually even be 100 percent.

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