BIDU short – A Followup

If you read my previous post, you know we were shorting BIDU, the dominant Chinese internet search engine, against its dominant trend.

Based on divergence of the price and rsi and stochastics, we felt the stock was due for a correction. Using Elliott Wave analysis and resistance points, we expect a correction down to 140, then 136.

How did we do? Well, we were right enough, although some of you were gleefully predicting our imminent capitulation as BIDU proceeded higher initially. Bidu dropped to 142, then 136.50, just a whisker away from our prediction of 136. It ticked back up to 142 and is headed back down but finding resistance at 140.

That's only 2.8% in two weeks. But hey, that's still over 50% a year. You can't always have steak. Sometimes mashed potatoes will have to do!

Besides there's still an excellent chance for the stock to move on the next stair down, my 130 target. Then my mashed potatoes would be become a "gratin de pommes au four", if you'll pardon my stretching the metaphor a bit.