Check out a couple of 3D printing stocks, along with a squeeze that’s working. (December 17, 2015)
I want to look at, actually, three different stocks today for whatever reason. I’m just feeling particularly charitable on this free video. First of all, 3D ( NYSE:DDD ). These 3D printing stocks have been like printing in three-dimensions, pain, forever it seems like. They peaked a couple years ago and have been going straight down to “heavens basement” otherwise known as hell; but lately this has been perking up. So this is the deal, you can see if you’re buying at the 50-day moving average that’s about the exact WRONG move to make; just every time the stock picks up above there and then it falls back down.
So here’s what I want you to do on this: just be mindful that about 8.50 is where support is and you are now $1.50 above where support is. That’s a pretty big distance, you’re just basically to high to buy here. Here’s what I would suggest doing, if you like this stock, if you’re looking to pick a bottom then at least do this: buy it where you think is the bottom, $10.00 is not the bottom. Again, if you like the stock and you want to buy it $10.00 is not the bottom, 8.50 is the bottom. So hopefully we get a little pullback in this and THEN you can go ahead and take that shot, it’s speculative.
Now Stratasys ( NASDAQ:SSYS ). The same industry, same chart, basically. Sideways consolidation, up at the 50, trying to get through, unable to do so. I don’t think you really want to buy here either. Hopefully the stock will pullback and then you can get it at a little bit lower level. But as long as this 50-day moving average is at resistance, that’s not where you want to be buying in anticipation of a breakout. “Oh I know, oh yeah, yeah now the stock’s going to breakout above the 50.” Well it doesn’t. It did here for a few days; the same exact thing with 3D ( NYSE:DDD ).
Now, the last one I want to show you is this, EYES, Second Sight Medical Products ( NASDAQ:EYES ). This is showing what a stock looks like when it finally DOES push through the 50-day moving average. You can see it hit it a few different times, was unable to get through it and then it really started yesterday. It really pushed through yesterday on heavy volume, that was pretty good volume here. And then it’s followed through today. Now on this one, 32 percent of the float is short. When you’ve got a stock that’s going up 11 percent a day, then yesterday I think it went up even more. When you’ve got a stock that goes up this high, this fast, you’re going to have a few shorts that are nervous, particularly after the stock’s already dropped.
If you’ve sold this stock short, what more are you waiting for? You made your money. Are you really going to short it here? Was it not something that you wanted to short up here? Or are you just now figuring it out now? Maybe the stock’s going lower. The bottom line is that the trade that you’re seeing in front of you is actually the trade that has already taken place behind you. So you don’t want to be short this stock. and I think as the stock goes higher it’s a reflection of the fact that more and more folks, in that 32 percent, that have got shares that are shorted, are figuring that out.
The short interest ratios, over 9 days to cover. So what I’m telling you is, I think this stock, now that’s it’s finally pushed through the 50-day moving average, is in a bit of a short squeeze. And I think you’ve got more upside coming. But, keep in mind, this is a trade. Seriously, it’s a trade. The reason I’m saying that is because this stock can reverse and hit 6.50, 6.00, 5.50 tomorrow, you just don’t know. So you have to look at this as a speculative, “rubber band” type trade where the shorts have leaned on it too much. Now it’s snapping back, they’re getting hurt. You’re probably going to see some upside momentum. Typically these stocks go farther than you think they’re going to go. But then they also stop when you don’t think they’re going to stop.
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