Our stock on watch today is an old favorite of ours, which you’ve probably heard us alert on before. This time, we have a great trade setup for our strategy, a multi-day swing type trade. On top of that, we have a good nexus point where we could either go long or short depending on what happens at this critical level.
Lululemon (LULU) looks to be consolidating within a rising wedge formation around the 360-370 range. The break out of the pattern will likely signal the stock’s next bigger move, but which direction?
Continuing to hold below 370 could imply that buyers are exhausted and sellers are in control. However, if the stock was able to close above 370 and holding above that threshold, we would likely see sellers exhaust themselves.
Talking about the same stock again and again may seem tedious, but that actually brings up a good point about trading. I have seen many students fail to find their edge simply because they are looking at far too many stocks at once. The secret is to find a few stocks that move well on any given day and learn those handful of stocks intimately. How do they move? Is there liquidity? Does news move the stock? These are all questions that need answers.
Rather than look at the entire market, shop for a few stocks you think you can trade well and stick with those. Check out the video below for more on the possible LULU trade!
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