Blockbuster (BBI)

Company

"Blockbuster Inc. is a leading global provider of in-home movie and game entertainment, with approximately 9,000 stores throughout the Americas, Europe, Asia, and Australia." (company website)

Buy

5-Jun-06. Blockbuster has been bouncing around just below $5 for a couple of months now, following the reversal in March (see sidebar). Market Edge has BBI as a "Strong Buy" based on technical analysis. This is the third test of the $5 level since the end of April, and the 50-day moving average has just crossed above the 200-day moving average. We'll see.

• Price momentum (PPO) — picking up after a long decline
• Trend (ADX) — stabilizing just at the threshhold after a long decline, and buying pressure (+DI) has crossed above selling pressure (-DI)
• Money flow (CMF) — strongly positive
• Relative strength (RSI) — strengthening from neutral
• Volume — heavily traded (over 2M shares/day) with mostly up-days in past week.

Sell

31-Jul-06. I got blockbusted! After the company reported earnings last week it was savaged by the market. Sometimes when a stock is slammed, a bounce follows and at least some of the loss can be recouped. Well, BBI landed with a thud.