AAOI trade ideas
AAOI - Watching for Put EntryAAOI is an interesting play opportunity. I will have to watch this one closely, because the short term chart looks like it has potential to go either way. This has been in a bearish market for the past year. This had a strong 3 day drop from around 42 to 32. It has consolidated between 30-34 for the past couple weeks after this drop. The last trading day formed a doiji signifying an attempt to start running back up or dropping back to the 30 support. If 30 cracks this will likely test the 25-28 support area. With the high short float, I'm looking for puts on the rundown back to 30. I will be looking for entry 33-33.50 with a SL around 34.
Applied Optoelectronics, Inc Ready to turn up Enter price: 42.40
Stop Lose: 41.40
Target Price: 43.95
Size: 350 shares (a volatile counter)
$AAOI shut down HARD at resistance today!This might not be a bad short setup - I'm personally taking no position, but potential certainly seems to be there for a failed breakout.
long-term sentiment is positiveLast week, Rosenblatt initiated coverage of AAOI at Sell amid worries of price wars and declining margins. Even with demand up for fiberoptics in China and the United States, price competition should heat up in 100G and 400G module markets, which may make AAOI's 40%-range gross margin unsustainable.
Piper Jaffray is upbeat on the optical-equipment makers today, as the firm sees easier comparables amid a reset at China's ZTE, now working free of a U.S. ban.
Our technical analysis shows that:
The stock short-term sentiment (next 30 days) is trending negative;
The mid-term sentiment (3-6 months) is trending positive;
The long-term sentiment (9-12 months) is positive.
www.finstead.com
More room to go down if break resistantForming a 'double top' in the last two months. If the resisitant is broken, the downward room is huge.
AAOI Possible two weekish swing tradeFeels like a possible setup for a two-weekish swing trade. The stock hasn't broken the trendline yet and is still trending long with decent volume.
Two possible entry points: the bounce off the trendline retest or near support @ around $40.50.
Profit Target: $49
Stop Loss (Trendline Retest) $41.90
Stop Lost (Trendline Break) $39.90
Shakeout....look at gap down close level...supportShakeout....look at gap down close level...support
AAOI LONG IDEA80% SHORT FLOAT SHOULD PROVIDE JUICE FOR A MOVE HIGHER ON A CLOSE OVER 44ISH.
EYEING JULY 20 45 AND 47 CALLS AROUND $2 AND $1.4 RESPECTIVELY. WILL UPDATE IF SETS UP AND WE CAN CATCH IT
Watch for $39 - $36 levelsShould sell off and find short-term bottom at these levels and decide where to go afterwards.
AAOILooking for this to either push through 46.90 or back test the .618 at around 39.57. A push past 46.90 brings 50, 52.77 and 61.56+
$AAOI Inverse Head & Shoulders$AAOI Possible inverse H&S pattern forming. 50d EMA trending upward. Volume picking up. Watch for strong break through 35.00 level in the near term.
Targeting mid-40s in the medium term. Breaching the 200d ema on the daily and 37.50 resistance will be key.
$AAOI C&H Pattern Setup$AAOI C&H pattern developing. Monitoring for a possible short squeeze coming. 1st target $37.82 near 200d ema. Note: very high short interest 75-80%.
Bottom FoundThe bottom of the almost 1 year lasting decline seems to be found. Even if we may try another test down there shall be a retracement up finally.
