Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
You can’t make this up. Those two headlines (above) were one after another on ZeroHedge.
That’s probably enough. You get the idea. 🙂
In the case of Carvana, let’s look at what the price action is telling us is the most likely event.
Carvana, CVNA, Daily
After-Hours on April 2nd, trading posted briefly at 243.6, within the purple oval, creating an ‘Up-Thrust’.
Last Friday’s action penetrated support and is holding.
Note the price range of that day’s bar is less than Thursday’s, with volume slightly larger.
For now, CVNA, has stopped dead at support.
There may be follow-through on Monday, but with the (YouTube) crowd and others expecting a ‘crash’, that makes is less likely (not advice, not a recommendation).
When a real expert warns of a crash, it may look something like this (time stamp 6:42).
Note the condescension from the other panel member.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
There are sure to be plenty of post-mortems over the weekend; usual suspects giving us their assessment on what’s already happened. 🙂
Sometimes the question, is not ‘what’s happened’, but ‘what has not happened’.
That’s where the opportunity may lie.
Market Implosion
Over the past week, there were wide price bars, with action unstable in all major indices (ETFs): DIA, IBB, IWM, IYM, IYR, QQQ, SOXX, SPBIO, SPY, XLF, and XOP.
However, what did not implode (completely), are the car dealerships; specifically, CarMax and Carvana.
For this update, we’ll look at CarMax.
CarMax, KMX, Weekly Close
On a close basis, KMX, has bounced off the lower wedge boundary and is near the resistance area (magenta line).
Price action could be positively biased in the coming week as a result of ‘tax refund’ car buying (not advice, not a recommendation)
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
That’s two times in a row, Carvana hit a target area (presented on this site) in the after-hours session.
The last time was here, CVNA printed 310, in the after-hours on February 19th.
Then, just hours ago, price action thrust higher into the zone in this post, printed at 243.6, then collapsed.
We never got to ‘Day 34’.
However, the real story may be in biotech XBI, with huge swings in both directions; currently (as of 6:35 p.m., EST) trading below today’s regular session low.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Even as price reached its after-hours high of 310, on February 19th, and posted down ever since, short interest continues to decline.
As BigCharts reports, short-interest is now at 6.5%.
First, it was 33% short, then it dropped to 10%, then 7.8%, and now 6.5%, all the while, it looks like we’ve passed the top (not advice, not a recommendation).
The last update showed a trading channel that has since been negated. So, what’s price action doing now?
Carvana CVNA, Daily
As of this post (10:47 a.m., EST) price action has yet to define another channel … if there is one.
What we do have, is a Fibonacci time sequence in effect thus far.
At this juncture, we’re far away from the magenta (target) oval and Fibonacci Day 34.
However, as outlined by Car Questions Answered, this time of the year, typically has tax refund purchasing.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Yesterday’s mid-session update said Carvana’s posting a repeating pattern.
That pattern is what’s called a Wyckoff ‘spring-to-up-thrust’.
Even before, yesterday, this update said we’re expecting some kind of bounce.
Well, we got it; then, price action went on to post a potential reversal (not advice, not a recommendation).
Today’s session may or may not contain a ‘test’ of that (reversal) action.
Let’s go to the chart.
Carvana CVNA, Daily
There’s a lot going on.
As the chart notes, when taking the retrace measurement from the after-hours high of 310, posted during the earnings release, yesterday’s action topped out right at the Fibonacci 23.6%, level.
We’re about twenty-minutes before the regular session; CVNA, is trading lower by 3.6-pts.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The Danger Point® 