BIDZ.com, Inc. (BIDZ) looks to be entering a new phase. Regular readers may remember a post in early February that noted how the stock appeared to be in the early phase of trying to form a base but few seem to betting on a bounce. A month later I revisited the stock as it was having trouble at resistance. A look to the chart below shows that base appears to be morphing into an uptrend.
The stock was rejected at the zone 12 in mid-January and again in late-February. A push into the zone earlier this month saw an initial rejection but this one was much milder. In past posts I have discussed the idea of resiliency in the face of resistance and this is a good example. Instead of seeing the "normal" behavior of sharp selling the stock consolidated just below that resistance before making another push.
With a small gain Friday and a 10% surge today, the equity is now firmly through that obstacle. The stock is nearing a short-term overbought condition but that former resistance would now be support. Looking past the near-term overbought concerns, it would appear that the stock has shifted to being in an uptrend.
What makes this shift interesting is that few (still) seem to be betting on it. A look to the front-month open interest configuration shows little in the way over head calls. Meanwhile, according to data collected by our Quantified Analysis department, 28% of the stock's float is sold short.
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