Rally In Virgin America Grounded By CRT Capital

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Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.Virgin America IncVA
shares were trading lower by $1.67 (5 percent) at $30.69 in Monday's session. After rallying nearly $2 on Friday from $30.38 to $32.36 off the news that Virgin America had withdrawn a S-1 (selling stockholders have decided not to proceed with an offering at this time), it is surrendering much of those gains. The ax in the stock today is CRT Capital, which downgraded the issue all the way from Buy to Sell -- a rare move among Wall Street analysts, who primarily back off an issue gradually. Virgin America, which soared off its IPO in November from its low of $26.50 to $45.83 in December, has been in retreat ever since. All of the decline taking place as one of its biggest costs (crude oil) has moved sharply lower. Interestingly, Monday's steep selloff is finding support at the same level that it bottomed at on Friday ($30.51), reaching $30.52 before rebounding to its current level. If the decline continues, there may be additional support at the pair of lows from April 22 ($30.04) and April 23 ($30.11).
Posted In: TechnicalsIntraday UpdateMoversTrading IdeasPre-market outlook
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