Consumer Goods Tech

$GRPN . There was never a chance.

For $GRPN, there was never a chance for them to be bullish.

Just look at the Ichimoku chart for Groupon. The price level was trading below the kumo most of the time. There was only a small peek in Feb above the kumo and it fell very quickly breaking through various support and even gap down before April.

After which, it was just a ride down. Today, less than $6.


$GRPN . The cheap gets cheaper. Target below $10

$GRPN is a good example that one can easily evaluate its business model and decide if it is a good long term hold.

Even in the absence of business analysis, we can easily see how once the Ichimoku indicators are formed, all signs point to a bearish downtrend.

For those who think it is a good buy because it is now trading at close to $10, here’s some questions to think about.

1. Where is the growth area?

2. How will they increase their margins?

3. What new products or services are they launching that will dramatically change the way they do business and hence, increase revenue?

4. Management. The accounting issue is serious. After addressing this issue, will there still be growth?

I do not have answers to all those. However, the Ichimoku chart suggests  a strong downtrend.

And just because it is cheap does not mean it is a value buy, is it?


$GRPN . Ichimoku barely formed and it is a bear.


The Ichimoku indicator is not even fully formed on Groupon ($GRPN) and already we can see that the bearish indicators are aligned:

1. Tenkan sen cuts Kijun sen towards the down side (sharp cut)

2. Price is trading below the leading kumo

3. The leading kumo seems to suggest that it is about to twist; further confirming that the trend is towards the bearish side.

Target price $15.