Stock Picks and Trade Ideas for Monday
New Buy Candidates: AEHR, NCOC, NOG
New Short Sale Candidates: FSLR (if it closes near its LOD-currently at 282.85), GHM (currently at 52.10)
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Update: FSLR makes a good short-sale right now. The stock is reversing hard and hitting its LOD on above average volume. This looks like a short-term top for the stock.
Here is the problem with GHM. I've noticed that there are quite a few people that are bullish on it. I'm not trying to bash anyone who is actually long or bullish on GHM. It is just a matter of differing opinions. Anyway, here is the chart of GHM and the reason why I am bearish on it...for now.
Graham Corp (GHM- AMEX) 3 month chart
A. This is where the problem lies. For one, the 50 day Ma is still below the 200 day Ma. This indicates that the stock has not properly set up a base for a healthy breakout. Also notice how extended GHM's movement has been right from the beginning. These thrust-like breakouts are too far away from the initial trend (which has been left behind at the main moving averages (50 and 200 day). Normally, you would have liked to see the trend much closer to the main moving averages such as in exhibit B. The only positive that I can see is the strong RS at the moment. Still, I don't believe that this will be a sustainable move on the long side.
posted by Nick M. @ 11:32 PM
3 Comments:
GHM ? Looks like it is heading to the stars right now. Shouldnt we wait for it to turn its head down.
Yre,
I know that shorting GHM seems like the wrong thing to do (and maybe it is), but from what I can see, the stock is severely overextended from a faulty base. If the stock actually continues to go up in such an overextended manner then I will be surprised beyond belief. This market has been hanging on for dear life on a tiny thread that doesn't seem to easily break because of the babying that the FED is providing. On top of that, we have corrupt financial media telling individual investors to buy, buy, buy all day long. This is the reason why the market has been inching up ever so slightly on below average volume. I don't know about you, but I want this market to fall. But I don't want it to fall so I can make money on short positions. I want it to fall so that we can start a fresh, new bull market. That is when the big returns are made. Anyways, I apologize for going off on a rant but the current market environment disgusts me. Anyways, just keep an eye on GHM. I'm thinking that it will head lower from here. For now, lets watch it. Only time will tell what will happen.
If anyone is long GHM, be careful as the stock is thinly traded and low float. Today, the stock is down 7%. It is hard to tell if this one will make a better long or short.
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