GMCR giving me the jitters

NoDoji

NoDoji

GMCR had a nice gap last month and a great run up and, today, with yet another run to new highs, all this roasted coffee started making me jittery.

I understand with a 30%+ short interest (and probably a lot more short interest since it hit the 80's), a heck of a lot of shorts are getting soiled, while providing a steady stream of buyers.

So the stock is trading at 90-ish today and I decide to peek at the fundamentals of this company and see that their 2009 earnings are estimated at $1.51 a share.

(!!!)

Does this seem even more irrational than Mr./Mrs. Market has been known to be in the (CROX) past?

I would ask "What's up???" But I already know the answer: "GMCR!"

This appears to me to invite a strong back month options play to the short side.

Surely there will be a pullback to the reasonable 80's, thereby letting poor souls who are dying to buy this stock get in at a bargain.

Am I insane for thinking this?

Is there a secret "long" signal I'm missing here?
 
Pile into this trade. There's so much momentum behind this one, on top of all the shorts. They have so much news coming down the pipeline with distribution and partnerships with huge names, like McDonalds, Cuisinart, Walmart. I've seen this before, many times, and you can't fight it. Go long. It will probably hit another 30% by end of next quarter.
 
Quote from NoDoji:

GMCR had a nice gap last month and a great run up and, today, with yet another run to new highs, all this roasted coffee started making me jittery.

I understand with a 30%+ short interest (and probably a lot more short interest since it hit the 80's), a heck of a lot of shorts are getting soiled, while providing a steady stream of buyers.

So the stock is trading at 90-ish today and I decide to peek at the fundamentals of this company and see that their 2009 earnings are estimated at $1.51 a share.

(!!!)

Does this seem even more irrational than Mr./Mrs. Market has been known to be in the (CROX) past?

I would ask "What's up???" But I already know the answer: "GMCR!"

This appears to me to invite a strong back month options play to the short side.

Surely there will be a pullback to the reasonable 80's, thereby letting poor souls who are dying to buy this stock get in at a bargain.

Am I insane for thinking this?

Is there a secret "long" signal I'm missing here?
More...

I know absolutely nothing fundamentally about the company. But coffee stocks are strong. My team and I recognized GMCR today after watching DDRX rip up and GMCR hadn't moved yet. We should've bought it. The sector is strong. Look at DDRX, CBOU, and GMCR and there are probably more. Manage your risk and you may manage to make some money.
 
Quote from mililani:

Pile into this trade. There's so much momentum behind this one, on top of all the shorts. They have so much news coming down the pipeline with distribution and partnerships with huge names, like McDonalds, Cuisinart, Walmart. I've seen this before, many times, and you can't fight it. Go long. It will probably hit another 30% by end of next quarter.
More...

OK, that settles it, as soon as moves down to the mid-80's I'm all in!
 
Quote from NoDoji:

OK, that settles it, as soon as moves down to the mid-80's I'm all in!
More...

When IOMEGA came out with the Zip Drive in the late 90's, it was a pretty big hit. The hype around it was out of control. The stock price went from something like sub $2 to almost $300 in a year. Pure mania. GMCR has a similiar feel to it.

By the way, dood, don't go 100% into any trade. When I meant to pile into it, I meant to go your full trade position. For me, that's 20%
 
Quote from mililani:

By the way, dood, don't go 100% into any trade. When I meant to pile into it, I meant to go your full trade position. For me, that's 20%
More...

You must be new here if you think I was serious :p

The only time I'd be all in is if I could travel back in time and buy GS in the 47.00's.
 
GMCR for the week of June1-5. Open Monday 81.51 closed at 91.42 This is after Barron’s wrote article that was negative on GMCR even saying an insider sold his shares.

Came real close to shorting this bad boy around 84 on Wednesday but just could not pull the trigger. Had nice run for this week even with negative news about company.
 
I planned to go long in the mid 80's and ride with the herd, but it never made it. Hit new highs again. Some talking head put them on Monday's long list, saying they're going to $100. Reminds me of when POT hit $242 and an analyst firm raised their target price to $325. That was beginning of the fall and POT eventually fell to $47 from that point.

My short bias is really starting to kick in at these levels. I'll probably start day trade it to the short side because at this price the moves are nice, but what I'm really looking at is back month puts for a larger move with limited risk, because I'm well aware of how irrational the market can be.

OK, gonna go have some coffee now...
 
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