Huge set of updates today!

I’ve been loaded with exams and essays, but I’ve done a good amount of stock research today to do some portfolio adjustments. First, lets start with the stocks I want you to let go of.

Amgen (AMGN) has finally got something to step in the way of it’s mojo. With the democrats taking control of the house and senate, all channels of communication are saying, “Drug companies will take a hit.” Well thank you for your self fulfilling prophecy. Amgen has been slowly sliding a bit, so its time to lock in the gains. I suggested Amgen at 66 and it’s time to sell now at 72.05. I will send this one off with a 9% gain.

Aqua America (WTR) took a major jump in October, and things have gotten a bit more unpredictable lately. For the short term investor I am suggesting to lock in gains. I would NOT sell this stock if I was a long term investor. Aqua America has much room to grow, and the sell I’m suggesting today is for the trader only. I suggested WTR at 21.70 and it now trades at 24.15. Lock in this 11% gain.

Chicago Mercantile Exchange (CME) looked horrible from chartist’s perspective and sadly it still does. I can’t hold onto a short if investors don’t agree, and that seems to be the case. I suggested shorting CME on a day when the stock had a 30 point jump. This means you could have shorted the stock at the top of its range and made a profit, or got in too early and lost. I will call this one a push, even though I did end up shorting myself at 517 and the stock is now at 502. For records sake this stock has been a break-even 0% gain.

Now onto the good stuff, I found a new short sell to add to the portfolio, Netflix (NFLX). I have been waiting patiently for this stock to get high enough, and it finally has. Its last earnings report was a good one, but this shouldn’t last. The whole concept around Netflix is great. For a monthly fee, you get to receive DVDs through the mail without late fees. Wonderful if it weren’t so easily outdated. Let me give a few examples of new and future technology that will steal Netflix audience:

1. Handhelds like PSP are selling their own special DVDs
2. Microsoft will start selling hi-def through Xbox Live
3. Amazon.com will start selling downloadable movies
4. Apple is starting iTV in 2007 to download movies
5. Blockbuster’s TotalAccess is similar to NFLX but allows returns directly to stores

Even if Netflix started selling downloadable movies, the question you have to ask is “Can Netflix compete with Sony, Microsoft, Apple, Amazon, and Blockbuster?” My answer is no, not a chance.

Competitors aside, the charts look bad. This two-year chart shows a major resistance at 30, along with a lower MACD. I will be short selling Netflix in my personal portfolio.
-Chris