A Comparison of "High Flyers"

Over the course of the past couple of months a number of high flying momentum names have quickly fallen off a cliff.  Most recently was Green Mountain Coffee, which had been forming a longer term head and shoulders topping pattern prior to breaking down as illustrated below.

Following a worse than expected earnings call, the company proceeded to breakdown below the neckline, and has not looked back since.  A great illustration of how important it is to get off the train when momentum breaks.  For further illustrations of the power of broken momentum, I would refer you to $OPEN, $CREE, $JVA etc etc.

More recently I have been watching Salesforce.com ($CRM) which has been a powerful momentum leader of the past couple of years. However, some of the more recent earnings call have not been at par with the street's expectations. As illustrated below, $CRM is also forming a very similar head and shoulders pattern to that of $GMCR.

 Furthermore, there are clear signs of institutional distribution in both instances on the right side of the pattern.  In addition, the insider activity in $CRM of late has not painted a pretty picture either (do your own digging).


Just an observation, take it for what it is worth.