The short entry for the LNKD short setup has been revised to the next intraday break below the current LOD of 226.25. As two additional price targets have been added, the target numbers have been resequenced. On the previous LNKD (LinkedIn) short setup posted earlier this month, the entry criteria was posted a break below the gap support which is now labeled as T1 (first target). My thought process here (besides the insanely over-valuation on the stock) is as follows:
LNKD gapped down at the open and continued to move lower following last night’s earning release. The selling continued until just after 10am ET today, taking the stock clearly below the uptrend line. That move below the well-defined uptrend line most likely cleared out the vast majority of long-side stops and sucked in quite a few shorts, as a key support level was broken. Therefore, chances are that if today’s break below the uptrend line was just one more in a long list of recent fake-downs (false break-downs/bear traps), then LNKD should continue to move higher from here. From the look of the chart, with long standing, powerful divergences in place as well as most social media stocks looking to have recently topped, I’d put good odds that LNKD will likely take out today’s previous lows and continue to move impulsively lower from there. Again, best to wait for a break below 226.25 to help avoid jumping the gun as we are already so close. My current preferred target is T2 at 187.70 although that will likely be extended once/if it becomes clear that the social media bubble has finally popped. Updated daily chart: