NFLX Revisited

I mentioned NFLX had the makings of a bubble October last year.  10 months later, it has finally happened.  Cashing out on the short side took immense patience but it could be done; as you can see multiple attempts must be made in order to finally catch the downfall.

In hindsight, catching the $300 short would have been absolute luck and guessing.  A safter approach is to short at the 20/50 day ema retest which occurred 8/31/2011, just a couple weeks ago.  Resulting entry price: $230-240. 

Netflix never had unique, difficult to replicate product.  Business model doesn't bar entry from competitors.  It was just a matter of time, like many ideas in history.

Is it too late to short? No, but wait for the next 20/50 day ema retest.  The gap from $50 will be closed.

1999 vs 2011

A few stocks in the cloud computing , social media, and online streaming segments have a 1999 "bubble" feel to them. 

NFLX, OPEN, BIDU.  The patterns are very similar to CSCO, JDSU, and a few others from 1999.  Decide for yourself.  Be patient and wait for the signal.  That's how the big money is made.

2011 Outlook

2010 ended up being a year for consolidation before taking off in September.  The indices are all hitting 52 week highs and the trend is very strong to the upside.  Corporate earnings have mostly beat estimates and the higher equities price are well justified as fundamentals are supporting this move.  Short term, I believe the market will face consolidation into mid March before moving higher. 

10/26/10 - Bubbles!

NFLX:

 BIDU:

10/26/2010 Market Update

The market's current position could be interpreted as near the top in a double top formation, and it's about to start a down leg, or near the top, and about to start another run higher.  The greatest profits are made near market turns, and this could be such an opportunity.  My intuition tells me that a small leg down will start near the Nov 2nd elections with first support at 10,900 on the dow followed by 10,730.  I do not see the DOW falling much more than that. 

GNW - Monthly cup and handle

AAPL - Short Opportunity Fizzled

The recent short opportunity for Apple did not materialize as the $242 support held for two consecutive days even though the price was pierced intraday.  That is tremendous strength, and the 2nd day even turned out to be a bullish engulfing candlestick pattern.