Pre-marketing preparation of the day’s stock: quickly
Benzinga’s PreMarket Prep airs every morning from 8 a.m. to 9 a.m. ET. During this fast-paced and highly informative hour, traders and investors tune in to get the top news for the day, the catalysts behind these moves, and the corresponding price action for the upcoming session.
Each day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick as well as producer Spencer Israel.
No matter how good a chart is or how detailed an investor’s trading plan is, information about a problem overnight or before the opening can be disruptive. An example of this is the atop price in Fastly Inc. (NYSE: FSLY), which is Tuesday’s pre-market prep stock.
Fastly’s Rough 2021: Fastly had a rough time in 2021. After ending 2020 at $ 87.37, it sprinted to $ 122.75 in January and traded at $ 119.95 on February 10.
The problem hit the skates after peaking at that level and was halved on March 5, when it hit a low of $ 58.21. The show tried to bounce back, but was back in the $ 50 zone when it took another lower leg.
After the May 5 close, the show faded from $ 58.06 to $ 42.31, when the show was punished for a first quarter failure on the upper and lower lines.
The stock quickly sets up the hard bottom: It took a while, but over 10 days – including the day of low gains ($ 41.41) – the problem set up a series of lows that laid the groundwork for the recent rally.
That range was slightly below $ 4, from the ultimate low for the movement ($ 39.47) to $ 41.98.
Rapidly going slowly, stable until Monday’s breakout: After the last low at the top of the range, Fastly stock has climbed higher over the next 11 sessions, ending last week at $ 47.20.
It posted a strong bid on Monday, breaking above $ 50 for the first time since earnings day, closing the session up over $ 3 to $ 50.71. Based on the high price, the issue can be expected to continue upward unimpeded.
Not so fast: At around 6:45 a.m. EST Tuesday, Fastly slumped lower amid a disruption to the global content delivery network tied to its servers. The company said the issue has been identified and a fix is in the works.
PreMarket Prep co-host Dennis Dick, who was already a buyer of shares in the company, identified the pullout as a buying opportunity, counting on the issue to be resolved quickly.
“This is an indication of how important this is to all the businesses that have been affected by it,” he said. “Based on his strong performance on Monday, others may also try to buy the pullout.”
The full discussion of the Tuesday show’s issue can be found here:
Fast price action: Fastly was able to regain much of the early morning losses by the opening bell. In fact, it opened well above the pre-market low ($ 47), traded less than $ 1 lower, and immediately caught a strong bid, ultimately closing 10.85% higher at $ 56.20.
The problem now lies in an area of limited price memory leading to its all-time low, when it fell after its first quarter failure to $ 57.71.