4 ideas to trade on the short side for next week 03-06-2017

Market Analysis

The market continues to march forward with SPY testing 2400 on March 1st 2017 reacting to president Trump's promises along with a calm and composed tone. On the flip side, the speech left so much to be desired for but it was enough to push the market higher.

On Friday, March 3rd 2017, Fed chair Janet Yellen hinted that the rate hike is on the table for March prompting the financial sectors to close up on Friday and SPY retracing to 2380. Next week should continue to expect SPY to retest the 2400 level again and decide where to go from there.

Trade Recap from last week (2-25-17)

Let's look at some of the ideas we talked about in last week's blog post which we thought were very actionable.

Long Ideas

  • AAOI – Applied Optoelectronics, Inc. : We mentioned this as a long setup for next week but cautioned there would be profit takers on Monday. Now the stock trades at $53+ from $46.
  • GBT – Global Blood Therapeutics, Inc : We were expecting a $30 breakout and it did happen but couldn't sustained. $27 should be a strong support for this stock and if that can hold it would continue to try and test $30.
  • KEM – Kemet Corporation : We called out KEM to be a strong swing potential. It has closed $1 above since Monday (02/27/2017).
  • VSAR – Versartis, Inc. : We expected this stock would test $23 and it did twice giving the opportunity to make $1.50

Short Ideas

  • ACIA – Acacia Communications, Inc. : Even though ACIA closed on a positive note on Friday, we were expecting more downfall and the stock fell by $2 mid week and was a good opportunity for short term trade.
  • ZOES – Zoe's Kitchen, Inc. : ZOES ended the week to $17 from $19 when we called it out.
  • RDUS – Radius Health, Inc. : We were looking for more downfall on RDUS stock but instead it closed strong on Friday but continued to moved sideways to close the week.
4 short ideas for 03/06/2017

Even though the markets euphoria continues as we march forward the saying,

A rising tide lifts all the boats.

doesn't apply to every equity in the market. There will always be handful of equities trending downward or taking a nose dive due to a legitimate catalyst or change in fundamentals that affect the business. I've used our prospecting engine to identify short ideas next week as shown below in the screenshot.

shortsetup03062017

To Learn more about how to use and take advantage of our proprietary gauges; i.e. - Berserker, Elasticity, Flux, and Social... watch the instructional videos we created on our howitworks page. Now back to the results in our scenario..

NTNX – Nutanix, Inc.

Currently trading at a 4 months low, Nautanix issued a weak Q3 guidance prompting the stock to trade in an all time low territory. Fundamentals aside, trading over 10 times more than average volume on Friday and short float at 31%, I'd expect some sort of bounce early next week and would look for an entry around $24 or $25 if it can get up there to play on the short side. I'd expect NTNX to trade at high teens in next few weeks if it continues to trend downwards.

BKE – The Buckle, Inc.

With elasticity stretched far away from 0 and trending downwards in the negative direction and retails sector getting crushed in the past few months, Buckle, Inc is a very strong candidate to trade in mid teens in the next few weeks. Decreasing sales and revenue will continue to propel Buckle downwards until something changes fundamentally. Usually retailers in such situations try to close stores as a "strategic decision to focus on stores that are working"

buckle-03-04-2017

PBYI – Puma Biotechnology Inc

As the news of competitors (Roche) drug passed phase 3 trial Puma gapped down but is now on it's track to retrace the breakdown high of $35.50. If $35.50 doesn't break and the price continues to trend downwards and falls through the range of $29 then $27 and $23 are the next stops. Even if we don't want to be short on this for a long time the high flux can produce a great intraday range of profiting.

BOX – Box, Inc.

The year over year growth has been compelling for Box and the stock has been on a nice uptrend since bottoming out at $10 in early and mid 2016. On March 2nd 2017 stock made a strong move to the downside breaking the near term support on a high volume due to not so stellar guidance but with strong earnings. If $17 support doesn't hold along with a 50 day MVA, we're expecting Box to go to the $15 territory again.

Box-03-06-2017

Alright, That's it for now folks. Happy and Profitable trading next week!

If you're interested in learning how to find highly actionable trading ideas everyday like the ones in this blog post, sign up for an account at http://buysellshortcover.com, our new idea generation platform. We're currently in open beta and there is no cost for using the platform during this time.

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Saadey (साँढे)

compsci background, high perf software engineer by profession, fintech fanatic, entrepreneurial, food lover, soylent, traveler, NBA fan, geek, and avid learner.

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