Altria has been a strong performer this year up 22% over the S&P 10%. It continues to be a strong buy on most analyst and investors radars. The stock has formed 2 bases in the last 6 months and each has resulted in a $5 move.
Well its coming out of a base again and it is in a prime positon to be a short squeeze candidate. The short interest ratio is at 6.6 the highest it has been in 2 years. If the stock continues on the same path its been on its could pop as shorts start to cover.
Fast and Furious is what today was. When the ECB announced their short term plan to deal with sovereign debt the market did not like what it heard. Last week Mario Draghi was saying that the will do everything in their power to prevent the collapse of the Euro, this was not viewed as doing everything and so the market sold off. The takeway today was it could have been much worse. The Dow was down almost 200 points intraday, but by the close we were only off 92 on the Dow and 10 on the S&P.
Looking at weekly chart of Blue Nile is like looking at large slide. The stock just keeps dropping. Technically it keeps rallying into sell-offs and then when you think it found support it just drops through the floor.
The numbers aren't much better for NILE. Its sales growth rate over the last 3 years has been pretty tepid at 6.5% range and earnings this quarter are down year of year 61% from last year. So with little fundementally good about the stock and the technicals pointing the same way its best to say that this stock one to avoid.
Initiating new positions would not be a wise thing to do tomorrow with the FOMC statement coming out tomorrow anything could happen. The market has reacted to some policy statements with indifferenc, but with QE3 on the mind of the Fed and the markets its 50/50 how things will play out.
believe the market is ready, and almost begging for QE3 and some action out of Europe and that is why the market has been bouncing of a technical support level. Just as things seem to be on the verge of getting bad. The central banks are in prevention mode of keeping Europe and the rest of the global markets from falling into the financial abyss. I am glad that they are I certainly do not want to see as bad a crisis as the U.S. went through in 2008.