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AEM: My Cramer Call Whipping Boy Revisited

July 31, 2008 1:23 AM

piggybank.jpgI have long been critical of Cramer’s call to be long AEM near the high. In addition, the stock was clearly a house of cards, to say the least. It hit a recent high of $80.29 on 07/15 and just 11 trading days later it is $55.60. This is EXACTLY why I repeatedly warn on stocks that have to clear points that are important. Why on earth would anyone be long AEM at $80 when it has to clear $83.45 to be long? Why?

Not to mention that this stock appears to be a massive bubble by any measure, but that is a different issue. Point being, If it had to clear $83.45 to be long, and you are long at $80, you are a complete knucklehead. and begging to donate your money. The stock has plunged over 35% in two weeks and there was simply no reason to even consider being long the stock in that range. This is what puzzles me about the markets. On 07/15 there was over 4 million shares traded between $75 and $80. There are buyers of 4 million shares near $80? It is mind boggling to me.  If I had more time to look at 30-50 charts a day, I could warn about these. The problem is, as I have mentioned, I simply do not have time.

At any rate, AEM has to hold $52.95 here and the “trade” is long above it, IMO. I would never say invest in this silliness, but that is the trade, as I see it, if you just have to trade this bubble.

Written by Tom@StockBlade.com · Filed Under AEM 

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