Marketsurfer says short shake shack

Surf, u need another point of perception here.
http://www.nasdaq.com/symbol/shak/short-interest

NO doubt there has been covering, look at chart, also no doubt there're a lot of new shorts in last few days. Here's ur problem. There are 5.88mm shares in float , all of those are not actively trading. There're probably 2.5mm short today. It's a players game, people like me who figure 50-55% of the active shares r short right now. A little old ladies investment club in Podunk Kansas can lite that up let alone well heeled pros who scan for situations like this. Weighted to my side of the equation is the fact that those guys with shares to unload @ July unlock don't figure on doing it from the basement. Fundies have very little if anything to do with actively trading markets these days. It's just a big predator/prey game of thrust and parry. This thing can be lit up with what's practically lunch money for a lot of players. I wouldn't short it with Obama's $$.:D
Look at the volume compared to the past, those aren't Shak aficionados.
 
don't get me wrong this stock is toast long term just right now is an exercise in moving street money to institutions. As Banjo says this is a predator/prey game which is in full flow. Once you know the signs it is very clear what is happening. There are clues in the structure of the price too. the largest retail cfd broker on the planet (retail bucketshop) had 67% retail shorts spoos/dow before the open today. its a reliable profit centre for them, the accounts are public and you can divide their net profit(increasing YOY) by number of customers and the figure is roughly the same as average joes disposable income for the year.

it's just simply transferring of money from the less informed to the well informed. this theme is played out across the piste over and over again.

how did i know spoos cash 2105 was a bottom when surf called out my spoos rip call earlier today? those 500 stocks weren't worth any any less than when they opened, it's not value thats being traded on that timeframe.
 
Chris Mac said:
Thanks surf.
I started 11 years ago as a US equities fund analyst (worked with companies like Legg Mason, Columbia Wanger...). I learned how long-term investors manage money.
In 2007, I started to manage multi-assets funds. Hard times, but as a lot of people here, I survived.
I understood that the game was not only about fundamentals but mainly psychology :
I read dozens of books about behavioral finance, risk management and technical analysis.
Today, I am comfortable with a mix of TA, psychology, instinct (experience?) and a bit of fundamentals (but valuable information is rare...).
I manage around 600 MEUR for clients, and hope I would be my own boss in 5/10 years.
That s why I am here: better understanding ideas, views, psychology, feelings of other traders, in order to improve anticipation and market reading.

CM
More...


Very cool.. Nice to have you here. I enjoy your commentary----
 
Well this is the same guy calling for an AAPL collapse, possibly the strongest company in the world right now. Why ? Because he does not like their watches LOL
 
Autodidact said:
Well this is the same guy calling for an AAPL collapse, possibly the strongest company in the world right now. Why ? Because he does not like their watches LOL
More...

Well, I agree Surf. Apple is a good short candidate.
Sure, shorting Shake Shack was a mistake. But don't think someone is enough stupid to do only mistakes in his trading. I made tons but I am still here.
Reminder :
In 2000, Microsoft was the strongest company in the world. -66%
In 2012, Apple was the strongest company in the world. -45%.
In 2015, Apple is the strongest company in the world. - ... ? At least back to 100 dollars.
Good fundamentals don't mean good price action.
And ugly fundamentals don't mean bad price action.

CM
 
This is contraversial but when I trade flat directional price on a timescale of a few hours to a couple of weeks I do not pay attention to fundamentals. I am much more concerned with what the institutions are doing in that instrument and how they leave tell tale signs in the chart (even though many of them dont look at charts).

If institutions are going to buy they will look to load up when price is going down they need that liquidity. Looking at the daily chart of SHAK it is very clear to me that instituions are very likely long from $72-$80 right when the retail minded shorts were getting juiced up and shorting. It's easy and reliable money for them.

Humans are hard wired to buy when its going up and sell when its going down. Institutions do the opposite.
 
Autodidact said:
Fair enough, now let's add validity to the call, by when and what's your stop?
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Ok, not the good thread for talking about Apple but I will answer your question.
Good short candidate, not excellent, because timing is not perfect and probabilities are low to go to 100 dollars fast. And shorting Apple now is like killing God in the financial world.
So I would not make it and rather shorting Nasdaq if the fruit falls from the tree.

On a ST basis, Apple is in a small trading range 129/133 (and evolves in a small symetrical triangle too).
On a MT basis, Apple shows an interesting pattern, mix of triple top and H&S. Nice declining RSI. (cf graph).

For a swing trade:
I would wait 129 support to be broken. If no rebound, short (for example @128.5).
SL @ 131.52
TP @ 112.50/115 (112.50 : january gap filled, 115 : MA 200 days)
Reward Risk ratio : 13 /3, above 3, which is fine.
If take profit ? Wait for the Big Apple to rebound strongly. 120 ? 125? 130?
Short again.

As usually, it will not be easy money, you will probably face strong pullbacks, but I think it worths it.
Now it is time for the WE, homework is done, and Monday should be volatil and plenty of action. Be prepared.

apple may.gif


CM
 
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