WCI Up Sharply!
OUCH! Yesterday WCI was up over 10% on twice the normal volume. About 5 million shares traded hands at about $17.5 which makes it nearly $100 million dollars worth. I was wondering who was buying up so much of this crap, and then I find out today thats its Bill Gates. His charity indiscriminately bought several builders stocks. This is a great time for the insiders to bail on the stock!
I was wondering whether to bail on the stock[close my short option positions] and eat my some small losses or to ride it out and incur either smaller losses or maybe much larger ones. However looking at the MACD it seems that just over $18 was the short term peak and its due for a pullback, which might offer a better place to exit. I could get more puts at this juncture but I’d rather just bail.
No point letting my ego get in the way.
If anyone can provide a better technical analysis on WCI, I’d love to hear it!
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November 15th, 2006 at 8:04 pm
My guess is that it can go up some more. LIkely that the biggest part of the move is done though.
November 15th, 2006 at 10:02 pm
If it doesn’t break the previous high it madea few months ago, I think I’ll be safe. still I’ll probably close out the Jan and March positions.
November 16th, 2006 at 12:24 pm
It wasn’t only the Gates Foundation that was buying. Carl Icahn reported that he now owns 4% of WCI stock. It was reported that he was buying because the underlying assets are worth far more than the stock value. WCI is highly leveraged and in the downturn they have layed off at least 15% of their staff.They are also selling off some assets and walking away from land deals. It was also reported that the high rise division which records sales on a percent completeion basis could drag them in to bankruptcy. Another large stock holder (Bass) is demanding a seat on the board.
November 16th, 2006 at 5:49 pm
Momentum is beginning to slow:
http://stockcharts.com/h-sc/ui?s=WCI&p=D&b=3&g=0&id=p03325854981
If the market goes down Friday it might too…