Thursday, February 19, 2009

Unable to resist...

Autozone (ticker: AZO), that is. This is a stock I have been watching closely because I smell gravity getting ready to take this stock back to earth. This stock doesn't want to admit we're in a wicked bear market and denial is a powerful force. However, it can't last forever and I decided to take the plunge today when the stock got up near $143/share using June expiration puts.

Below is what I'm seeing and my rationale. First, a 3 year weekly chart to see the big picture:

Next, a 6 month daily chart:

Lastly, a 60 minute chart over the last 4 months to show why I got in around 143:

And how about a ratio chart showing the performance of AZO relative to the S&P 500?

This stock's going down hard. I don't think it will take much longer and when it breaks, it will be fast, hard and ugly.

Wikinvest Wire