We’ve got an avocado shortage out here in California, but that’s not stopping Panera (PNRA). Here’s your trade. (October 25, 2016)

by DAN PNRA 
Today we are looking at Panera ( NASDAQ:PNRA ), and here is why: Because this is one of the few stocks that is actually gapping up after hours on a strong earnings report. This is a pretty easy video to do. You see this huge volume today. The stock is up and where is it? It is right at the 200-day moving average; we will call this 207.00. Now we will look at the intraday chart. Where did this go first thing after they reported? Clear up to 208.50 for a moment. So this has already been up above the 200-day moving average and now it is selling off. The is a key, key resistance.

The stock has been broken for a while so this is what I will say: If you were one of these guys that owned this stock and didn’t sell it when it broke down here, this is your chance. You get the chance to define resistance. You get the chance to be doing the, “I want my money back trade.” To where you regret holding the stock, and who wouldn’t? Comes down here, you say, “Well crap, I should have sold here,” but you didn’t. So now if you can get your money back you would probably consider selling. That is why I think this is going to be some pretty significant resistance, because you are not the only guy who thinks that way.

I can’t come out and just say, “Short Panera!” But I can say it wouldn’t be a horrible idea. The reason is because is, again, the stock is already broken, fell below support, now it has come back to support. This could easily trickle back down again. Earnings weren’t that awesome. So then what you do is, if you are shorting the stock you keep your stop, your buy stop, right up above the 200-day moving average. If the stock rallies up don’t sit there and watch this stock and say, “Oh I know it will turn around. I am just early.” No. You are wrong. If the stock goes back up above the 200-day moving average and you are short, you just need to cover that short. It is a small loss. Take a small loss and move on. You don’t ever want to let a small loss turn into a big loss just because you are stubborn.

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