Although LinkedIn's initial public offering price was raised from the initial $32 to $35 range to $45 a share, the stock ticker LNKD soared above that on the open at $83.00 on the New York Stock Exchange. [Market Close Update: LNKD hit a high of $122.69, corrected and closed at $93.86]
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You may want to save this chart for your records of what an IPO day can look like. Even CNBC reported there was a lot of energy on the floor of the New York Stock Exchange from the LinkedIn IPO. Question was, how would LinkedIn stock close today? Well, now we know.
The 15-minute charts shows the trading day of LNKD in all its glory and volatility. A morning snapshot of the stock price taken and reported earlier gave LinkedIn (NYSE: LNKD) a market cap of over $8 billion; the new high raised that to nearly $9 billion but only for while.
Witht an extreme day high and an established low minutes after the open, LinkedIn stock has a wide trading range on its very first day. With the low established at $80, the stock soared to $122.69 as a new high, then tumbled thereafter in the afternoon to $103 area. LNKD finally closed at $97.86.
Of course, every IPO has no stock price history to define price action, so this reporter had to use a 1 minute chart this morning just to get a better picture of IPO day volatility. The first 3 candles showed the initial high as 92.99 and the low at 80. Only the low remained, as the high was blown past less than an hour later. Strangely, it closed near that high of the first 15 minutes by the end of the day.
The Automotive Industry Connection
Lest you think LinkedIn has little to do with automobiles, think again. LinkedIn relates well to automotive professionals at every level. Aside from engineering and manufacturing organizations like SAE and SME, LinkedIn is becoming THE professional networking site for automotive professionals, because it includes professionals from every corner of business including the supplier base.
In this case, CAD designers can connect with other CAD designers; and engineers can relate to other engineers. And now with the advent of designing engineers, the arena is filled with both designers and engineers; plus they have a place to connect on a professional level outside of the workplace.
For the record, this reporter was first connected to LinkedIn about 3 years ago when I early retired form the auto industry. Now I receive requests from past associates, like many of my friends from Mexico whom I worked at the GM Studio, as well as new associates to reconnect or make new introductions.
Now that I write about automotive, the requests for connection are increasing. Some people I know; some I do not. Point is, LinkedIn has great potential for all professionals to get connected on a professional level without the Facebook socialite aura.
How to track an IPO stock
As I did with the GM IPO, I use shorter timeframes like 5 minute and 15-minute charts until the day chart starts generating some moving average.
In the meantime, pay attention to the levels already made public, like the initial price ranges of 32-35, as well as the 45 level. Another key level for price support will be the actual opening trade at 83. Then comes the low of the IPO day. The next lower level would be the midway point to the 45 level for the IPO open of 83. That would read as 64.
On the upside, the only measure we have will be new highs. The first will be today’s high. Any new high will redefine the trading range.
For the record, GM never made it to the levels defined by the analysts. So, their prognostications are not much better than the weather, and the weatherman at least has radar.
This reporter has added LNKD to the Auto Sector Stocks watch list at Torque News and will report on the technicals as well as the fundamentals as they change. So stay tuned.
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Disclosure: Frank Sherosky, creator of stocks charts for TN is author of "Awaken Your Speculator Mind" but does not hold any stock, option or futures position in this equity or futures at this time.
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More About the Reporter: After 39 years in the auto industry as a design engineer, Frank Sherosky now trades stocks, futures, and writes articles, books and ebooks via authorfrank.com. He may be contacted here by email: FrankS@TorqueNews.com
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