The Gilmo Report

September 5, 2018

September 5, 2018

The market’s glorious end to the summer of 2018 has run into some selling here in early September. As I noted in a tweet yesterday, none of the new set-ups I thought I was seeing over the weekend were showing any traction. In some cases, the stocks were getting outright blasted. Applied Optoelectronics (AAOI), was one shining example, blowing up spectacularly over the past two days.

The stock looked to me like a possible Ugly Duckling set-up as it was trading along its 10-dma, 20-dema, and 50-dma. On Monday it briefly opened just above the 20-dema, but immediately broke to the downside. Anyone taking a position that morning at the 20-dema would have been blown out of the position in short order.

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