AIG…76 Cents or ZERO?

It takes me the same amount of time to build a model on an individual stock as it does to build a model on a commodity or stock index and, for that reason; I really don’t follow a lot of stocks.  But in this case, AIG is such an important story stock—as are all of the brokers and a few large banks—that I found it worth while to build the model.  Anyway, I had literally just finished building the model today when I noticed a crash set up into 10-2 in the hourly model as well as an intraday sell signal in the 5 minute model.  It was at that point that I rushed that email out to you all at 9:43 titled “AIG CRASH COMING!!—GET OUT IMMEDIATELY. 

Well, AIG obviously tracked the model today in fact just two minutes after I sent that mail, the stock registered THE HIGH of the day at 9:45am PST as it touched the 4.36 level.  Then, as the sell signals triggered with the stock up 30%, the stock turned violently and plummeted 38% before bouncing slightly to close at 3.02. 

Below you’ll find the 5 minute model intraday chart along with an hourly model chart showing you all exactly what I’m seeing between today and October 2 (minus the proprietary stuff).  As you can see, I’m expecting weakness in AIG into about 11:00am PST tomorrow, followed by a sucker rally, followed by lower lows into about 10:00-11:00am PST on October 2. 

I have two targets…76 cents, and ZERO.  No clue if it is possible for AIG to go under but something destabilizing should hit the NEWS and hit this stock. 

Also remember that MS and GS should get caught up in this mess (probably inter-related if I had to guess)

Full report coming soon


Comments are closed.