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Social Media Stock Could Trade Like Chesapeake: Najarian

Jon Najarian says savvy traders should look at the recent action in Chesapeake; he thinks it could be replicated by a social media stock!

Now Najarian is strictly talking trading – but he thinks it’s noteworthy that Chesapeake didn’t break lower than $17 despite some serious headwinds.

As you may remember, last week regulators opened an informal inquiry into Chesapeake’s controversial program that granted Chief Executive Aubrey McClendon a share in each of the natural gas producer's wells. Then, on Tuesday,Chesapeake replaced McClendon as chairman.

But despite those negative catalysts, “The stock pounded down to a level with high volume then the bears couldn’t push the stock any lower. That’s a nice time to buy,” Najarian says.

Najarian thinks Groupon could be setting up for the same kind of action.

Shares of Groupon took a dive after the company said two board member were leaving as the company tried to address criticism of its accounting practices.

(In late March,Groupon was forced to revise its financial results for the fourth quarter, increasing its losses for the period to $64.9 million from $42.3 million.)

However, Najarian says what matters most for traders is the stock action, "and around $10.75 the stock bounced.

“If you push everything you can at a stock and it doesn’t slip any further – it’s time to take a look,” says Najarian.



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Trader disclosure: On May 1, 2012 , the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Pete Najarian is long AAPL; Pete Najarian is long BAC CALLS; Pete Najarian is long C; Pete Najarian is long MS; Pete Najarian is long INTC; Pete Najarian is long YHOO; Pete Najarian is long SBUX CALLS; Pete Najarian is long SBUX; Pete Najarian is long COP, SELLING OUT INTO BP TODAY; Pete Najarian is long PEP; Pete Najarian is long TXN; Steve Cortes is long MO; Steve Cortes is long PPH; Steve Cortes is long PFE; Steve Cortes is long XLE; Steve Cortes is short XLF; Steve Cortes is short SILVER; Steve Cortes is short EUR/JPY; Patty Edwards is long for clients HOF; Patty Edwards is long for clients CVX; Patty Edwards is long for clients PVH; Patty Edwards is long for clients QCOM; Patty Edwards is long for clients INTC; Patty Edwards is long for clients MSFT; Patty Edwards is long for clients COP; Patty Edwards is long for clients WLT; Patty Edwards is long for clients ACI; Brian Kelly is long SPY; Brian Kelly is long QQQ; Brian Kelly is long IWM; Brian Kelly is long KRE; Brian Kelly is long USG; Brian Kelly is long CAD; Brian Kelly is long TBT; Brian Kelly is long SOYBEANS; Brian Kelly is short GERMAN BUND; Brian Kelly is short YEN

For Fadel Gheit
Nothing to disclose

For Stacy Ragson
Bernstein currently makes a market in the following companies INTC
Bernstein currently makes a market in the following companies, QCOM
Bernstein currently makes a market in the following companies BRCM

For Will Landers
Will Landers is long VALE
Will Landers is long ITUB
Will Landers is long PZE
Will Landers is long AMX
Will Landers is long ABV

For Jon Najarian
Jon Najarian is long GRPN

For Steve Weiss
Steven Weiss is long X
Steven Weiss is long MT

For Anthony DiClemente
Barclays Bank PLC and/or an affiliate is a market-maker and/or liquidity provider in securities issued by Expedia, Inc. or one of its affiliates: EXPE
Barclays Bank PLC and/or an affiliate has received compensation for investment banking services from Expedia, Inc. in the past 12 months: EXPE
Barclays Bank PLC and/or an affiliate trades regularly in the securities of EXPE
Barclays Bank PLC and/or an affiliate has received non-investment banking related compensation from Expedia, Inc. within the past 12 months EXPE
Expedia, Inc. is, or during the past 12 months has been, an investment banking client of Barclays Bank PLC and/or an affiliate: EXPE
Expedia, Inc. is, or during the past 12 months has been, a non-investment banking client (securities related services) of Barclays Bank PLC and/or an affiliate: EXPE

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