Three names we’ve recently featured in our newsletter imploded Thursday. All of these were in the form of trendline breaks to the downside or bearish Pullbacks Off Lows (POL) patterns of stocks that were in overall big picture downtrends.
CPLA — Capella Education (First featured as a short-sell set-up at 78.71)
COCO — Corinthian Colleges (First featured as a short-sell set-up at 7.19)
LINC — Lincoln Education LINC ( First featured as a short-sell set-up at 14.61)
All along these stocks have been former leaders that are now laggards and has beens — as in past market leaders in the last up cycle that that topped a long time ago. While on the subject of cycles this is always the way it works. A good rule of thumb when dealing with leaders is that of : “Last Cycles Leaders Next Cycles Laggards”
Case in point — CSCO, JNPR and QCOM and countless other tech stocks from the roaring 1999 climax run. Those stocks have never come back and probably never will.
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