This is a static daily chart of the LL (Lumber Liquidators Holdings) short trade idea mentioned on Friday morning as well as a link to the live, annotated chart. Suggested profit targets are T1 (first target) at 91.25 and T2 (second target) at 71.72 with a potential, but not current, third target around the 49.00 area. As various entry criteria were suggested for this trade, stops should be set according to one’s unique entry price(s). LL remained below the primary uptrend line/breakdown level following the post on Friday morning, trading around 114 at the time of the post and then started to fall sharply just before noon EST on the news that Whitney Tilson of T2 Partners was short the stock (a well timed and probably not purely coincidental press release as the stock had just broken major support with strong bearish divergences in place on the chart).
As usual, the odds for a reaction (bounce or consolidation) off the first tag of T1 is likely so at this point, anyone who missed an objective entry on Friday might wait for either a bounce towards at least half-way back to the trendline before adding to or initiating a short position OR wait until the stock makes a solid break below the T1 level, preferably after a decent bounce or consolidation off that level. Click this thumbnail image to view the static chart as of Friday’s close or click here to view the live chart of Lumber Liquidators.