So I pretty much pegged the downward spiral Baidu has seen over the last couple of days. Even though it was fairly obvious, I can still brag right? It recieved a downgrade to sector perform and well, the air let out of that balloon in short order. Its still looking overbought at this point and its going to let out some more air over next week. I'm anticipating it will make a short term rally, in a true distribution pattern, possibly double topping before taking a major plunge. There aren't any foreseeable resistance points for this stock. I'd wait a few days and short it if I was a day trader - but I'm not so I'm just going to sit on the sidelines and watch the chaos.
Google and Apple took hits as well. Google was based on the news that there really is no G-Phone and that the project is simply a software package which will help Google deliver ads to phones. With diversification out of the picture, a lot of the positive speculation is being rethought. This also might see a short term rally, but the technicals and fundamentals don't look good for Google.
Apple on the other hand seems to have primarily sold off due to some inside selling to the tune of $129 million. This stock is still, however, on a strong upward trend. It doesn't look like its going to see long term losses, but its hard to say. I have to think with the golden retail quarter coming up its not going to see sustained losses. I'm not in this stock and I don't intend on buying into it, because its at best fairly priced and at worst severely overvalued.
That being said, I'm not as bearish on Apple as I am on the search engine bellwethers. I'll be keeping my eye on Google, which will take hits as Baidu plummets. If it catches a downgrade that will signal a massive sell off triggering a price target of at best $615.
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