China Growth Stocks

[ari5000]

OT: shorting leader names


I'm not an expert in shorting and I wouldn't short leaders... but if one were inclined to, I might suggest focusing on a name that is already showing signs of distribution.

BIDU is, I think, much closer to potentially being an excellent short.

http://stockcharts.com/h-sc/ui?s=BIDU&p=D&yr=1&mn=0&dy=0&id=p19009545479&a=215913443

For educational purposes, here's a chart with some notes. You can also see GOOG for a good example of a leader name that has indeed broken down.

Even BIDU still needs to break its 50 day MA but once it does -- I think this could drop a good 10 points before finding any kind of bounce.

Everything is about Street support. BIDU already lost the 20 day MA.

Then again - NFLX posted a bearish engulfing candle in Aug. and late Sept. The next 8 days were weak. So yes, assuming NFLX gaps down tomorrow - you might be able to catch a wave for a week or two.

What makes NFLX so dangerous is, you can see when it does finally pop, it can often gap up ABOVE the previous high which can erase 7 or 8 days profits overnight.

Are you thinking of trading the weekly puts? (I would.)