“Green Mountain Coffee GMCR +28.95%surprised the shorts and the price jumped 26% to a high of $36.50 after hours following positive surprises in earnings and forecast.
With 50 million shares short, about 9.5 trading days’ worth and 42% of the float being short, there may be a bit of a scramble to buy on Wednesday. Where is the next resistance level above $36.50? On the Point & Figure Chart it looks like $42. The weekly price chart shows resistance at $38-$40, although a slim case could be made for the breakdown point at $50 . Last May 3 it fell from $50 to $26. If there is a short squeeze, price could see a reversal of that move down.
If there is no short squeeze, then price will go up according to the new fundamentals just revealed by GMCR’s earnings announcement. A quick check shows that the 16 computer models had GMCR as a four star buy as of last Friday and obviously before the positive surprise in earnings. The total score for GMCR is 6 where 3 is best and 30 is worst. This is the adjusted score when we compare GMCR to the growth universe of stocks instead of the complete universe of 8,000 stocks. This score includes equal weighting for fundamentals, forecast and technicals.”
If you enjoy the content at iBankCoin, please follow us on Twitter
