Looking for a couple of shorts? I’ve got ’em for you in $BURL and $AAPL. (March 25, 2020)


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Burlington ( NYSE: BURL ); this is a stock that I traded, I actually did pretty well on it, not from the trading part but just the holding part because it was in a pretty nice move back here. I haven’t really touched it in quite a while other than little swing trades here and there.

I am looking at this stock right now and this is the way I am seeing this: At 110.00 the market thought the stock was pretty darn cheap and they started buying it up. This was the big massive low here, you can see this on the volume. The very next day the stock had actually gapped down a bit and then ultimately traded higher. Since then it has kind of been on a tear, at one point it was up 45 percent in just a few days. This is stupid money and if you go from the VERY bottom it is up almost 70 percent so this has been a monster move.

So what are we going to do now? If I was a betting man, and I’m really not, I would think the stock is going to actually pull back a bit. I think that today’s action was a real rejection of any further buying. The stock runs all the way up here today and then EARLY on in the day started rolling over. You can compare that to the SPY ( NYSEARCA: SPY ), which did really well all day up until the last half an hour when people started not feeling the burn. And so the stock was trending lower into the close with everything else but it really peaked here.

And so this is what I would do: I would actually consider shorting this stock. You have to give it a really wide amount of room because the real top here is at 180.00. But I think you could consider shorting the stock, preferably if it gaps up here. The closer it gets to 180.00 the better as long as it rolls over, as long as it starts to roll over. This is what is called a tombstone doji, for the most part anyway, I guess you could call it an upside-down hammer. But it is essentially what I would say is an exhaustion move.

I think all the buying pressure has been used up here and if the stock starts rolling lower you are probably going to get 10 to 20 points out of it. I wouldn’t look for a new low, I think this is a major important low. But I would look for the next ebb and flow to be an ebb to the downside before, then, we maybe get a higher level.

By the way, I started a little short position on Apple ( NASDAQ: AAPL ) today. Not a biggie but a little bit. Again, I am not looking for 220.00; I am probably looking for about 235.00 or so. If we get back down to here I’m good.

So those are two trades that you may consider.

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