Are you getting pleasure or pain from Playboy ($PLBY)? (July 14, 2021)
PLBY GME
I want to look at PLBY, which is the Playboy ( NASDAQ: PLBY ) Group. I tend to look at my stuff on MarketSmith, an IBD product, just to kind of see what the growth and valuation is and stuff like that. For me, the joke on this was the description. It provides products, services, and experiences related to pleasure and leisure, via their flagship brand, Playboy ( NASDAQ: PLBY ).
So is this stock giving you an experience related to pleasure and leisure? I would say no. Now, here’s the thing, when you see a stock do this, like what this thing did, it would be the same thing like with GameStop ( NYSE: GME ). It would be the same thing with the Meme Stocks, which I will be honest, I don’t even know what a meme is. What’s a meme? They call it a Meme Stock, it’s a stock, so we will just call them the Robin Hood Brigade. You will see all of those stocks too.
GameStop ( NYSE: GME ), you see how this stock screamed, and then it screamed again. Okay, and then at one point it peaked and this thing came down 90 percent. That’s not a verbal typo, 90 percent, this thing came down, and now it’s doing what it’s doing. Maybe it’s going to fall again, I don’t know. I just covered this stock today just because I was thinking about it. It’s probably going to go lower. But would you short GameStop ( NYSE: GME )? Not me, because you just never know what’s going to happen with a stock like this. This would be known as the “tear your face off” pattern because anybody who’s short has gotten absolutely crushed on this at times.
Now, Playboy ( NASDAQ: PLBY ), here’s a different deal. This was kind of the in-vogue stock, nice move here, as you can see, that’s a pretty good move. From $10.00 up to 16.00 in a couple of months, yay, I’ll take it, 60 percent, yabadabadoo, and then it falls back down and now we are up here. So the way I look at this though is, this run is over. It is over, the stock is down 50 percent. There is literally no support for this that you can find on the chart.
Now, wherever the stock bounces you can say, well Dan, that’s support. Okay fine, but I am not seeing a bounce yet. And I don’t see any logical reason for it to bounce at $30.00, other than for a cup of coffee. Or maybe since it’s Playboy ( NASDAQ: PLBY ), I don’t know, maybe a martini or something else. If you look at this on the weekly chart you REALLY get a sense of what happens when a bubble pops. The thing has gone up over 500 percent, since that peak it’s down 50 percent. Trust me, a 50 percent pullback on this can be just the start of a deeper pullback.
These high fliers, sooner or later, do retrace and they suck out all the money that had been in. This is why, if you are getting this stuff on the way up, you GameStoppers ( NYSE: GME ) and AMC ( NYSE: AMC ), and all that, that’s a good trade. That’s money, I’ve had people say, that’s not really trading, that’s gambling. Screw you, it’s TOTALLY trading. Somebody who buys a stock and holds it and makes 1000 percent, or 500 percent, no. That’s trading, that’s good trading. It might be high-risk, but congratulations.
The issue though is, when the FOMOs come into play. The fear of missing out, traders who buy it after it’s up so, so, so high because they think maybe it will go higher. What I am saying is, you look at Playboy ( NASDAQ: PLBY ), this is a stock that I’m sure some people are holding, thinking that it’s going to run up and regain its former glory and it’s all going to be good. Hey, I’m buying at 30.00, if the stock goes up to 60.00, that’s a double. Okay fine, but if the stock goes down to 15.00, that’s not a double, that’s a half.
I want you to be aware that stocks do go down and when a stock sounds intuitively obvious to all but the most casual observer, when a stock is going down you should not be holding it. The only reason you would hold a stock that is going down like this and creating a loss for you is because you are hoping that the stock will turn around. That’s not a good bet because whichever way a stock is going, the people that are riding that trend are correct, they’re right.
The people that the stock is going against, if they persist, they persist in holding it, those are the ones that are wrong and you don’t want to be right, what was that old song? If Loving You is Wrong, I Don’t Want to be Right. Loving a stock that is going down, trust me, you aren’t going to be right.
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