TradingView
QuantifiedAlpha.com
Jul 7, 2015 1:51 AM

Quant Model Indicates 20-day Downside in LL Before Earnings Short

LL Flooring Holdings, Inc.NYSE

Description

+ Currently below all three moving averages (20-day, 50-day, & 200-day). Academically proven that future returns will be weak moving forward (papers.ssrn.com/sol3/papers.cfm?abstract_id=1656460).

+ Barely oversold, as the stock has consolidated at lows. Fairly liquid, so wouldn't benefit from the return reversal effect anyway.

+ Extremely high volatility makes technical analysis very effective, as investors turn to TA when prices are chaotic. This amplifies the magnitude of our Quant model's confidence.

Likely 20-day price scenario of $17 to $20. Price target of $18.50 sometime around next earnings release. Cover before ER, as LL is now undervalued. Anything positive and it will shoot higher.
More