MCD is in trouble !

Discussion in 'Stocks' started by hajimow, Dec 24, 2012.

  1. hajimow


    MCD has been the DOW's dog this year. Its performance has lagged the market. MCD warned about the sales and the stock dropped. Last month sales was a little bit up relative to analysts estimates and the stock rallied from 86.5 to 90 but we see more sign of weakness in the stock. The fact that the company asked the brances to be open on Christmas day is also another warning sign that they have not made their sales and they are lagging. I recommend shorting MCD at this level. Cover price would be 86.5.
  2. hajimow


    Here is the daily chart
    • mcd.jpg
      File size:
      101.1 KB
  3. hajimow


    Another stock to consider shorting is ADI. It is in semiconductor sector. Cover target is $40. You can short the stock and then sell Jan 40 PUT to beef up your profit. Their prediction for next Q is that sales will be down 6 to 12 %.
    • adi.jpg
      File size:
      110.8 KB
  4. hajimow


    I try to squeeze my ideas in one thread. Here is what I believe:
    1- Retail sales are down. Even online sales are down. People buying stuff online also affects restaurant sales (including MCD).
    2- We will see a huge drop in the market on Wednesday (after XMS). Market will start to get real jittery.
    3- I am long TZA but I don't recommend it for the faints of hearts. You should know what you are doing.
    4- HLF will be below $10 in a month but I don't know why I don't have any position on this stock. Shares are not available for short but I believe the best way to short it through PUT spread.
  5. hajimow


    Check out SPY weekly option prices. Comparing out of the money Calls and Puts premium shows that the there is a huge fear of market dropping 5% or more by this week. 145 Call bid/ask is 1/2 cents while 135 Put bid/ask is 6/7 cents.
  6. Bry


    Yeah, short term bearishness looks pretty set without a fiscal cliff resolution.
  7. Daring


    It's going to be a pretty dangerous last week of the year for swing trading with overnight volatility and the typical low volume of these dates.

    Another thing that comes to mind is that due to the uncertainty of the taxes for next year our government put a damp on one of the most bullish economics weeks of the year because people are being extremely cautious, therefore, their incompetence continues to hurt what they are trying to fix.
  8. your thread titles are pretty catchy and you tend to get me to click on them but there is nothing in those charts to say bear market
  9. Doesn't Dog Dow theory mean that it's a buy for 2013?
  10. hajimow


    My thread was initally about MCD which is in bearish trend and today's action confirms what I said (I know just a day). Basically you cannot prove your theory in a chart after it happens. Making a case to short MCD without having followed its recent news is diificult. Then I went off tangent and added my other stock in my short list and the ETF that I am long and how I believe what is happening in the market.

    I also believe having a resolution for fiscal cliff today will not have the same effect if we had it two months ago. Most of the damage is done and it will show itsel in the coming months. First effect is that holiday sales are down and companies are not hiring. Economy is in semi freeze mode. This is what exactly Ben said in his last interview.
    #10     Dec 24, 2012