Friday’s move on UBER was a big tell. Today’s reversal just could lead to tomorrow’s opportunity. See this video for my analysis. (July 01, 2019)UBER
Uber ( NYSE: UBER ); as of Friday I was looking at buying this. I just noticed it into the close on Friday and I was thinking about buying it but I thought I would not buy it because it’s Friday and I typically don’t like to open new positions on Friday. And if I did it certainly wouldn’t be buying something it would be selling something; like selling an out of the money call or put position, something like that. So I decided to wait until this morning and then the market was really strong. And when the market is really strong first thing in the morning, frankly, I don’t really buy then either; because I don’t like to buy when everybody else is buying, I like to wait for my entry, so I waited.
If you look and see how this thing traded today you can see that it gapped up first thing in the morning and never looked back, it just traded down virtually all day long. So does that mean that we say goodbye to Uber ( NYSE: UBER )? No, not at all. In fact, this is the thing, this kind of move that we see on Friday, on volume, big massive volume, almost 30 million shares, that’s institutional buying.
Now, a good question you might ask is, why would anybody be buying this stock when the prospectus for the IPO says, “Oh, by the way, we may never make any money.”? My answer would be, you know what? I don’t know, but mine is not to wonder why. So the company may not ever make any money but that doesn’t mean the stock can’t go up to $100.00. This is just the dynamics of the market so don’t let that scare you away.
This is the thing, the stock printed today what’s called the bearish engulfing pattern. Those of you who are sticklers will find some flaws in this but I am not going to go into that. Let’s just say that the stock gapped up above or almost above Friday’s intraday high and has definitely closed below Friday’s intraday low. Volume was still heavier than normal, not like Friday but remember, this is institutional stuff. I like the fact that volume was lower here.
So this is the deal: I am actually looking to buy this stock; not first thing tomorrow morning, maybe. If the stock is firm here, if it holds right around here I would want to buy this stock; not because of today but because of Friday. Because I think Friday was a big day. Today, pretty typical based on what the market is doing. So this could give us an opportunity. It’s like, Friday gave us a signal. It gave us information about what institutions are doing.
This week, and certainly today, is potentially giving us an opportunity, we’ll know more tomorrow. And if not tomorrow, Wednesday. But this is something that I think we really want to keep an eye on. I am not an Uber ( NYSE: UBER ) guy, in fact, actually, I take Lyft ( NASDAQ: LYFT ) I think Uber ( NYSE: UBER ) sucks but I will buy the stock if I think it’s going up, it doesn’t matter to me.