Prep for Another Drop in Akamai

by Sam Collins | June 15, 2012 2:30 am

Akamai Technologies (NASDAQ:AKAM[1]) – Akamai has been a favorite of the Trade of the Day since Oct. 31, 2011 — then recommending the stock as a buy at $29[2]. The stock ran to almost $40. But when the company missed its Q1 and announced its CEO would retire, we recommended selling it on April 26 at the market. It had closed at $39.76 the day before.

I also said, “This is a very volatile technology stock, and so a fall back to the low $30s might be a place to reinstate new positions.”

But despite positive reports by several research analysts, the stock fell to under $26 and on a bounce failed to close above its 200-day moving average. This failure confirmed that a huge double top is in place. Sell AKAM if you own it, or short it with a price objective of $26. A stop-loss should be placed at $32 to protect against a reversal.

Akamai Prep for Another Drop in Akamai

chart key Prep for Another Drop in Akamai

 

 

Endnotes:
  1. AKAM: http://studio-5.financialcontent.com/investplace/quote?Symbol=AKAM
  2. recommending the stock as a buy at $29: http://investorplace.com/2011/10/akamai-has-cooled-but-is-heating-up-once-more/

Source URL: http://investorplace.com/2012/06/prep-for-a-second-drop-in-akamai/
Short URL: http://invstplc.com/1nBvo3x