EBAYD trade ideas
Ebay Long - Technicals & Valuation (2-6 weeks)Technicals and valuation support a bullish rebound. Supports at 35 from the channel it has been trading in since June. PE of 5.2 is cheap in this market where the S&P trades at a PE of 25. Excellent margins (80%) support their profitability. Even though Amazon dominates this space, there should be enough room in ecommerce for Ebay to continue to grow.
Ebay Gap FillEbay should be able to rally into the gap fill for a small gain.
Price is rallying from a demand zone currently.
Short term buying opportunity towards Black Friday? EBAY is testing support as we approach Black Friday and Cyber Monday.
The shopping spree expected can boost EBAY following its recent decline and send it back towards the bottom of the rising triangle, to test it as resistance.
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EBAY Long 2-6 Weeks Technicals and valuation support a bullish rebound. Supports at 35 from the channel it has been trading in since June. PE of 5.2 is a steal in this market where the S&P trades at a PE of 25. Excellent margins support their profitability. There should be enough space in e-commerce for both Ebay and Amazon NASDAQ:AMZN allowing both to continue to grow.
EBAYOur preference: bullish as long as 33.2 is support with goal 36.6.
Alternative Scenario: The 33.2 will be depressed, triggering a return to 32.2 and then 31.6.
Comment: The RSI is greater than 50. The MACD is positive and below its signal line. A correction could occur. Additionally, prices are below their moving average 20 (34.7285) but above their moving average 50 (34.0411).
Selling On eBay 101On May 5, 2017, the eBay Inc 150 day moving average crossed below its 200 DMA. Historically this has occurred 14 times and the stock drops a minimum of 1.483%. It has a median loss of 6.923% and maximum loss of 25.517% over the following 27 trading days..
When we take a look at other technical indicators, the relative strength index (RSI) is at 54.5317. RSI tends to determine trends, overbought and oversold levels as well as likelihood of price swings. I personally use anything above 75 as overbought and anything under 25 as oversold. The current reading has the stock in the neutral realm, potentially negating major price swings. The RSI has been trending lower since July 2016. Even though the RSI typically cycles between overbought and oversold levels, that has not necessarily been the case with this stock. Overall the RSI is failing to make newer highs which is another significant signal of downward movement. This overall downtrend should continue as long as the RSI stays below this trendline.
The true strength index (TSI) is currently -2.5244. The TSI determines overbought/oversold levels and/or current trend. I solely use this as an indicator of trend as overbought and oversold levels vary. The TSI is double smoothed in its calculation and is a great indicator of upward and downward movement. The current reading declares the stock is down. This indicator has always been trending down and failing to make new highs since August 2016. The overall price should continue to trend lower as long as the TSI remains below this trendline.
The positive vortex indicator (VI) is at 0.9946 and the negative is at 0.9559. When the positive level is higher than 1 and higher than the negative indicator, the overall price action is moving upward. When the negative level is higher than 1 and higher than the positive indicator, the overall price action is moving downward. Currently the stock has been stock in a tight channel since early March with neither the positive or negative indicator breaking out. This congestion may prevent major swings in the price.
The stochastic oscillator K value is 84.9079 and D value is 80.6932. This is a cyclical oscillator that is highly accurate and can be used to identify overbought/oversold levels as well as pending reversals and short-term activity. I personally use anything above 80 as overbought and below 20 as oversold. When the K value is higher than the D value, the stock is trending up. When the D value is higher that the K value the stock is trending down. Currently the indicator is in overbought territory and the downtrend will begin soon.
Considering the moving average crossover, RSI, TSI, VI and stochastic levels, the overall direction appears slightly mixed, but down is doable. Based on historical movement compared to current levels and the current position, the stock could drop at least 2% over the next 27 trading days.
Ebay Bearish Trade due to normal pullbacksIt is normal for the market to make corrections when things get to high up and for people to start profit taking once earnings are announced. I know ebay as a stock that is volatile when it comes to earnings. So due to the big upswing this has been in it is natural to expect a downward swing to come bring others to reality. It can always go against me, that I do know. But I believe the chances of me winning out weight the chances of me losing on this trade which is a bearish credit spread with a credit taken in of $105.01 after commissions with this particular trade I went ahead and loaded up twice on the same trade so I took in around $209. With a risk of around $188, and max return of $209. Wish me luck. This strategy will set the precedent for the Macy's trade I have outlined in my "ideas" section on tradingview. I told my significant other that I am a bit afraid of this trade going against me because it is ecommerce, and I believe so much in ecommerce that I find this risky to bet against. BUT in the short term (which is what i'm doing) I would believe this can go down on earnings.
eBay to 35+With the eBay & Flipkart news out, eBay is in a bullish trading channel after it broke out last week from resistance. Looks for this to steadily climb as more and more retailers are shutting their doors.
EBAY building a baseI'm kinda biased on the long side for EBAY but let's just wait until it breaks out of this pivot at 34.05 with supporting volume before taking any action.
