This is an article for those of you that either owned or are thinking of investing in CrowdStrike (CRWD) . If you owned it please tell me you had properly set stop losses and were sufficiently diversified to minimize your exposure to losses.
Today's Chart of the Day is not selected by my normal selection process. Thursday was a bad day, Friday wasn't much better and I really don't have any hope of Monday reversing the trend. In short, I went in this weekend and set all my stop losses, and would not be surprised if some of them trigger this week. I'm not looking to buy back into the market until I start to see a little daylight again. Yes,Yes, I hear the screams yelling “BUY ON THE DIP” but I'm not convenced the bottom has been reached.
Look at the Barchart Stock Market Monentum:
Market Performance Indicator
Barchart Market Momentum Index ($BCMM) [-0.46%] is an exclusive index used as an indicator of change in overall markets. It reflects the movement of stocks who fit the following criteria: must have current SEC filings, must have traded for a minimum of 6-months, and must be trading above $2.
Market Average
The percentage of stocks in $BCMM above their individual Moving Average per period.
| 5-Day MA | 20-Day MA | 50-Day MA | 100-Day MA | 150-Day MA | 200-Day MA | |
|---|---|---|---|---|---|---|
| Today | 14.38% | 31.01% | 48.71% | 48.95% | 51.16% | 55.76% |
| Yesterday | 24.76% | 50.70% | 60.67% | 57.65% | 57.86% | 62.15% |
| Last Week | 67.53% | 71.69% | 69.53% | 64.30% | 63.14% | 66.75% |
| Last Month | 40.66% | 44.61% | 39.06% | 42.11% | 44.46% | 51.17% |
I'll wait till I see some support in the 5 and 20 DMA.
Getting back to CrowdStrike (CRWD) , look at the Chart of the Day Chart:
The stock has a Barchart technical sell signal of 24% and is 45.30% off its recent 52 week high.
When I look at my chart comparing price to the Trend Seeker, 50 Day Moving Average and the 50 Day Hi/Lo 50 day Turtle Channel it looks even worse:
There are so many unanswered questions about the stock:
- What is the total damage done to the Revenue and Earnings of their customers?
- Does their service agreements shield them for liability?
- How many of their customers have business interruption insurance that will pay off?
- Will the companies not covered sue?
- Will the insurance companies that pay claims sue?
- Will any of their suits win?
- How large is their present legal reserve?
- How many of their present customers will migrate elsewhere?
- Has their reputaion been damanaged enough to scare off new customers from signing up?
Too, Too many unanswered and even unasked question to list.
Right now, in my opinion, CrowdStrike is not and investment, it is a speculative situation.
Please, on the rest of your portfolio have stop losses and diversification in place that reflect not only your risk tolerance but your parameters to accept and live with your risk exposure.
Be rational and put your emotions aside.
On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
