This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Brand Name Stock-Specific Bubbles are Popping from Amazon to Yum

Stocks in this article: AMZN DHI MCD UPS UTX YUM

NEW YORK (TheStreet) - The popping of a stock-specific bubble occurs when a stock sets an all-time or multiyear high then quickly falls below its 200-day simple moving average. If the underpinnings of the stock market are healthy this should not happen!

This is the story for all six of the stocks profiled today. All have been chopped to the earnings woodshed after reporting quarterly results.

When companies from several different sectors and industries take sharp share price slashing, there's an economic story to tell. You have the largest on-line retailer, a major homebuilder, the largest fast food burger chain, the largest package delivery company, an international conglomerate of products such as elevators, air conditioners, aircraft engines and helicopters, plus the parent of Taco Bell, KFC and Pizza Hut.

READ MORE: 10 Stocks Carl Icahn Loves in 2014

Technically all six companies are trading below their 21-day, 50-day and 200-day simple moving averages and below their five-week modified moving averages with declining 12x3x3 weekly slow stochastics. All six stocks are above their 200-week simple moving averages, which is the longer-term reversion to the mean.

Let's take a look at the stock profiles. (AMZN) ($312.99) set an all-time intraday high at $408.06 on Jan. 22 then corrected to as low as $284.38 on May 9 as this bubble popped. The stock was below its 200-day simple moving average between April 3 and July 11. The bubble was re-inflating going into its earnings report on July 24 trading that day as high as $364.85. The stock plunged on a negative earnings report below its 200-day SMA at $349.76 trading as low as $305.30 as of 12:45 p.m. today.

The weekly chart is negative with its five-week modified moving average at $328.76 and its 200-week simple moving average at $250.49. Monthly and annual value levels are $279.94 and $259.67, respectively, with an annual pivot at $334.95 and quarterly and semiannual risky levels at $385.43 and $419.21, respectively.

D R Horton (DHI) ($20.70) set its 2014 intraday high at $25.23 on July 2 then closed at its 200-day SMA at $21.93 on July 24. The company reported quarterly results before the opening bell on July 24 and missed analysts' earnings per share estimates by 17%. The stock subsequently broke below its 200-day on July 25 trading as low as $20.31 as of 12:45 p.m. on Friday.

The weekly chart is negative with its five-week MMA at $22.81 and its 200-week SMA at $17.37. Semiannual and monthly risky levels are $23.01 and $25.41, respectively.

McDonalds (MCD) ($175.26) set an all-time intraday high at $103.78 on May 14 and closed below its 200-day SMA at $100.15 on July 21. The company missed analysts EPS estimates by 3 cents before the opening bell on July 22. The stock was already below its 200-day SMA sot the sellers piled on pushing the stock as low as $94.20 as of 12:45 p.m. on Friday.

The weekly chart is negative with its five-week MMA at $98.62 and its 200-week SMA at $91.55. Monthly and annual risky levels are $97.93 and $99.30, respectively.

READ MORE: Warren Buffett's 25 Favorite Stocks

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs