Maybe Friday is the day for Twitter ($TWTR) (October 24, 2019)
TWTR
Let’s look at Twitter ( NYSE: TWTR ) here. This is pretty ugly here, this is a weekly chart by the way, not a daily chart so you know the stock tanked and the volume was huge. Now again, this is a weekly chart but we will look at the daily real quick, you see this volume is off the charts, literally just about off the charts.
The weekly chart is what is so interesting to me and I will tell you why; because I am looking at a lower high here, the stock had kind of ran up a bit. A lower high and now it has just absolutely gotten crushed below the 40- week or 200-day moving average. And so now we can look at this type of thing; look at maybe 27.00, right now 30.00 is holding and that could set us up for a trade tomorrow, which I will get to in just a second. But all in all, this is Helga’s House of Pain right now. Everybody that bought here is in pain and this goes back a long way, right? You can even go back here but I’m not drawing for coloring class here.
The bottom line is if we go back virtually everybody that bought in 2019 is now either flat or underwater. I think we will probably get more selling pressure here. I would absolutely not be buying this stock unless it’s for a day trade. I mentioned this, this morning, the trade never really came off, but the stock fell and then it started to rally a bit but just not that much at all. And again, that kind of lends itself to my bearish thesis on this stock, that if this was all it could muster, just about 2.0-2.5 percent from bottom to top and then it drifter lower again I think there is still more supple to hit this market. But I could certainly be wrong and that’s okay, I’ve been wrong before and I am absolutely sure I am going to be wrong again.
If this stock starts to get some kind of buying tomorrow this would be the trade that I would make. I would actually look for (this would be a really quick flip), I would look for 31.00 to be my line in the sand, where I would need the stock to run up above 31.00. The low is 30.51, so I would keep a stop at 30.45 so I am risking $0.55, $0.60 if you wait for a nickel above 31.00. And then you are taking this stock for a ride, and maybe it is going to snapback quite a bit more. But don’t anticipate that trade, because as I said, this is big, big selling and this stock could have a long way to go to the bottom. If you don’t think it can do that you have got to think again. This wasn’t that long ago when the stock was down at these levels.
So again, I have got to say it again, I am not predicting that it is going to do this but I am telling you, it might. And so don’t be smug about just buying this stock and then if you get underwater say, “Oh well, I will just wait until I break even and then I will get out of the trade.” That may very well not happen. The day trade that I am talking about would be very, very specific, I am not going to go over it again and tell you what the parameters are but you have got to be managing your risk. The only way that you are going to get into this stock is if it moves above $31.00. If it doesn’t then you are doing nothing.
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