Here are a few things to ponder if you’re trading Google (GOOG) and/or Facebook (FB). (October 18, 2012)
FB GOOG
I’m Dan Fitzpatrick at Stock and OptionMarketMentor.com on Thursday, October 18th. Today I just want to take a quick look at Facebook ( $FB Facebook Inc ). Okay, you know what happened in Google ( $GOOG Google Inc ), they missed earnings estimates by like 10 percent. This is what happens to a high-flying stock, a stock that ran; let’s look at the percentage here, 35 percent since July. So they miss estimates and as it was, you know frankly, even if they made estimates, the stock still probably would have sold off a little bit because this was an earnings run, you know 35 percent in a few months, so it would be time to take profits. But now, this thing, it’s not just time to take profits, its time to cover your rear. So what does this do to Facebook ( $FB Facebook Inc )? Well, Facebook ( $FB Facebook Inc ) is trading down very, very close to its low here of $17.55; so this is like less than a $1.50 away so what are you going to do? Look, Facebook ( $FB Facebook Inc ) announces earnings on the 23rd of October. Now, do you think Google ( $GOOG Google Inc ) earnings give any indication of maybe some of the things that Facebook ( $FB Facebook Inc ) might be struggling with? I do, and so I don’t see, you know I’ve got no crystal ball here, I’m very clear about that, but I don’t see how this company’s going to just wow the analysts with a great quarter when a company like Google ( $GOOG Google Inc ) struggled. Also, and this is important to, it’s really important, a heck of a lot more important than earnings, we’ve got these lock-ups that are due to come unlocked, in other words you’ve got all of these shares held by insiders that are going to be available for sale pretty soon. So my suggestion with Facebook ( $FB Facebook Inc ) is, look, stay away from this. It’s funny, I was watching CNBC just before I started doing this video and Donald Trump was talking to Marie and he said he actually bought Facebook ( $FB Facebook Inc ). I don’t know if he bought it today but he said he bought it at $17.00 and something so if that was the case that was a pretty good trade for him; but he says, “I don’t know if it’s a good deal or not.” Now, I don’t really care what Donald Trump invests in, in the stock market, I’m pretty comfortable with my own analysis, I don’t need his real estate that’s another story; the point is you do you have investors stepping in saying that you know maybe there’s some value here. What I would suggest doing though is just stand aside, let this thing do what it’s going to do, it only started trading several months ago, got a long way to trade. I would just stand aside, let the stock start drifting higher, it’s actually safer to buy this thing higher than it is lower, so for the time being, I mean if you want to short, you know that’s great, get your adrenalin while you can but I just think Facebook ( $FB Facebook Inc ) goes lower from here, it’s a very, very risky trade. Okay members, get over to the Strategy Session, we’ve got a lot of stuff cooking over there so I want you to do that. Also if you haven’t subscribed to Option Market Mentor, it’s $7.77 and that’s risk free, we’ll refund your money the first month if you don’t like it; if you do then I hope you stick around because the forum is rockin’ over there. Free Chart