BIDU Analysis

i was checking out China Net Investor’s blog about BIDU. this stock is really getting a lot of attention on wallstreet, so i pulled up the chart to see if i can spot any technical clues.

the thing is, though, that this stock has only been trading for 2 days, so technicals like MACD and RSI dont work for this stock.

the main indicator that will give us a clue on whats going on is going to be volume and psychology. today BIDU closed at $115. however, take a look at the chart. theres a gaping lack of volume from $115 all the way down to $100, meaning that BIDU could plummet very quickly to $100 unless if buyers rush in tomorrow at the open. however, the support at $100 looks decent because it is a psychological number and it is also confirmed with volume. tomorrows action will also depend largely on whether BIDU gaps at the open.

if BIDU’s death spiral slows down at around $100, brave daytraders can try buying some $100 shares and selling the dead cat bounce as shorts start covering. it’ll be interesting to see what happens tomorrow.