The Shorting of Frauds, Overhyped and Bankrupt Stocks Journal

Its an M&A stock so there will be plenty of dudes trying to pickup nickels. The big funds too will try to lend out their shares to create income
Last short as % of float was 20%. Not that high. I don't expect this stock to be that hard to short. Should take a while for SBUX to say anything anyway
 
OSGIQ at 0.90 cents
I don't trade bankrupt stocks often enough but there is probably some opportunities fading rallies there. Will watch this one
 
This occurred to me this morning - I'm sure the rest of you already thought of this - this report was commissioned before Starbucks bought Teavana. I looked through it for dates, and found that the lab reports date from October. So they were skeptical even before Starbucks bought it.
10 dollars as a price objective may be optimistic.
 
Quote from trefoil:

This occurred to me this morning - I'm sure the rest of you already thought of this - this report was commissioned before Starbucks bought Teavana. I looked through it for dates, and found that the lab reports date from October. So they were skeptical even before Starbucks bought it.
10 dollars as a price objective may be optimistic.
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yes, I thought about that as well. Guy did a good job and released early in the due diligence process(Effectively guiding what they should be looking for), this prevents DD people from getting their egos attached to a certain opinion or view, he released before they even developed much of a strong view.
I don't think the $10 will hold either if SBUX walks, allegations of fraud and likely drop in sales will hit stock big time. Price of the stock might be low but its a 34 times earnings(20 forward PE), PEG ratio is 0.86, thats why the PE is so high, growth expectations once that is gone stock will implode

My mistake here is likely to be not betting enough rather than anything else (Its already my largest short of the year)
 
Quote from Daal:

yes, I thought about that as well. Guy did a good job and released early in the due diligence process(Effectively guiding what they should be looking for), this prevents DD people from getting their egos attached to a certain opinion or view, he released before they even developed much of a strong view.
I don't think the $10 will hold either if SBUX walks, allegations of fraud and likely drop in sales will hit stock big time. Price of the stock might be low but its a 34 times earnings(20 forward PE), PEG ratio is 0.86, thats why the PE is so high, growth expectations once that is gone stock will implode

My mistake here is likely to be not betting enough rather than anything else (Its already my largest short of the year)
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I'm on my third time reading the report (in between watching the Detroit Lions struggle to prevent having Houston steal the game via the refs) and I have to ask: what's Glaucus's record? Are their short calls generally good? I'm not familiar with them; googling a few calls I found of theirs in the past I see that they were right about them. Any bad calls? Anything anyone knows about I need to worry about with these guys?
 
Quote from Daal:

Potential lesson from AAPL blow up
-When a widely owned stock by hedge funds breaks key support levels after being a momentum trade for a long time, its a good idea to CHASE the short and play the reverse momentum.

I should have shorted it at some point, now it could be a little late unless it pulls a nice rally
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What were the key levels that got broken, in your view?

I reviewed this move and IMO the warning flags were the break of 644 (prior 2012/all-time high), then the move to 609 after a failed attempt to rebound from that break.

The break below 570 (the low of the post-earnings miss selloff) was the next major level and triggered a panic bottom at 505. IMO AAPL's selloff is done, maybe it tests 480-500 for a few days but I suspect that's it.

So to me the potential red flags were:

1) stock very extended in price over a short time
2) widely owned, popular crowd position
3) momentum deteriorated then turned down

The catalyst was a close significantly below the previous breakout point (644). The confirmation was failure to rebound, and then (after trying to rally for a few days back above 650) a new closing low on a big down day.

Still, this is easy to say in hindsight. At the time I didn't take it as a short.
 
Quote from Ghost of Cutten:

What were the key levels that got broken, in your view?

I reviewed this move and IMO the warning flags were the break of 644 (prior 2012/all-time high), then the move to 609 after a failed attempt to rebound from that break.

The break below 570 (the low of the post-earnings miss selloff) was the next major level and triggered a panic bottom at 505. IMO AAPL's selloff is done, maybe it tests 480-500 for a few days but I suspect that's it.

So to me the potential red flags were:

1) stock very extended in price over a short time
2) widely owned, popular crowd position
3) momentum deteriorated then turned down

The catalyst was a close significantly below the previous breakout point (644). The confirmation was failure to rebound, and then (after trying to rally for a few days back above 650) a new closing low on a big down day.

Still, this is easy to say in hindsight. At the time I didn't take it as a short.
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I'm not a big support and resistance trader so I'm not sure about which level was important. I do know that when the volatility started to rise and the big red bars showed up and that is a huge warning flag. Big declines even if followed by big bounces can indicate that the market is getting nervous, there are still some fools wanting quick gains that are buying those dips and fighting the last war but since the supply and demand changed those same people will be dumping as the stock declines(weak hands).

I remember PTJ saying in an interview that big volatility is a sign of a market that is topping or something to that effect

The ATR(14) went from 10 at the peak to 19 right now. To me the big red bars are the tell

I agree that the bulk of the decline is over. There is easier money to be made from the long side compared to the short but its still tricky because the stock might chop around
 
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