Wednesday, May 23, 2012

May 23, 2012 - Market Update with a side of Chipotle and Apple

Interestingly enough, today marks one of the first days in the last month where the market leaders ($CMG, $AAPL, $PCLN, $BIDU, $NFLX) are up while the general market ($SPY, $SPX, $DJIA) are down. And I'm not even talking .01%-.1%, the disparity is pretty large.

Looking at Chipotle, it is still a short in my opinion until it crosses this downward trendline resistance. Today it's around 401.39. It has touched this resistance line about 8 times. The next two days will be EXTREMELY important because as of right now, it looks like CMG is getting squashed into a very tight channel between the trendline and the 100-day sma. Where it breaks no one knows...

 Next up, Apple. I am also still bearish on this stock for a couple reasons.
1. Hit its 573 resistance that it formed back when that was the 50-day SMA and bounced right off it.
2. The next support, extremely short term, is the 100-day SMA, which is what I would short it too.
3. 555, while a possible short/resistance line, has been broken multiple times today so I don't see it being a problem as much as one would think.

 Saving the most intriguing for last, Priceline has a couple technical bear signs, so take your pick.
1. I see a near perfect double top formed with highs in mid april and late april. I see 3 bottoms formed and I see an entry exit almost to a tee of what a double top should be. I also see a pullback to the bottom line. The target price point on this would be around $580.
2. If your looking extremely short term, PCLN bounced off the support turned resistance line and could very well be making its way down to the 100-day SMA like AAPL.

Disclosure: Holding June $365 CMG puts

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