Let’s profile the typical degenerate, small money, piker.
He bought FEYE and SPLK 20% higher, fully concentrated, leveraged at 50%. With yesterday’s drop, he is now below maintenance and will be forced to either come up with funds or liquidate. In the off chance the market really soars today, he might be able to stave off liquidation by pleading with his margin clerks, citing “market appreciation.” In most cases, Fed calls need to be met by 2:30-3:00 max.
This recent correction has been focused exclusively in the momo names. Old economy stocks have done well, or at least weathered the storm. The last time momo names took a beating like this was after the FB ipo. The centerpiece of that debacle was FB dropping by 50%, GRPN and ZNGA by 70% and YELP pressuring me by dropping from $30 to as low as $12, intra-day. The bottom line: just when you thought the correction was over, BAM, another limb got ripped off.
If we are to follow that same “pin-action”, there could be another 30% lower for many of these cloud/biotech names. I suspect the overall market will continue to do okay, simply moving away from those sectors as if they never existed.
Or, I could be wrong and we go straight up from here.
Either way, the margin clerks are coming today. You margin call players out there are gonna need a miracle to avoid liquidation.
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Buying the blood in SPLK with both hands.
SPLK is bidding $79 PM. I leveraged my position with some $80 calls yesterday, following the high volume.
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“The other side of the mountain is always hard, especially when you are skidding down it without pants.”
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Still laughing over that line !
Funny stuff !!!
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OA, if you read fly’s blogs take note of that front page pic. This is expert level.
I imagine it’s good ol Ben in the shadow’s behind that blunt.
This is steady eddy market.The U.S.A
is growing and unless America goes
all Dick Cheney this is fine stock pickers
canvas.
It appears a SPLUNK pilot was flying the Malaysian plane.
SPLK, trying to catch a falling knife can be dangerous.
SELL SELL SELL
YELP and TWTR looking like utter crap.
Keep day dreaming about la jolla
$DATA getting hit again. Almost time Dr Fly?
Back to the high seas matey..BALT