Stock of the Week: Martha Stewart Living Omnimedia
The recent ratings upgrade in Martha Stewart Living Omnimedia (NYSE: MSO) was a great opportunity for aggressive short-term traders. With MSO pulling back by less than 3% a day after earning a “consider buying” rating of 9 out of 10, traders who moved quickly were able to lock in a short-term trading gain in the final week of the year.
Shares of Martha Stewart Living Omnimedia bounced back into bull market territory in mid-December, quickly rallying to their highest level in months. With these gains in hand, it was no surprise to see traders become sellers, causing the stock’s advance to stall and ultimately reverse.
MSO began to appear on the radar early in the second half of December, earning a “consider buying” rating of 8 out of 10 on December 23rd and earning a further upgrade to 9 when trading resumed on December 27th.
Shares of MSO pulled back by just shy of 3% on the following day, meaning traders with intraday entries of 2%, would have been able to take long positions near session lows on December 28th.
Just one day later, the stock was up 6.7% alone. And those traders who used limit orders to take positions 2% below the close on December 27th were able to capture almost all of that move when their orders were triggered intraday on the 28th.
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