Go or No Go on GoPro (GPRO)? Here’s your trade. (April 07, 2016)
GPRO GPRO MPC
In this video I want to look at GoPro ( NASDAQ:GPRO ). Here’s why: There’s nothing happening here. There really isn’t. But this is what I’m looking at: The stock is in kind of in a bit of a volatility squeeze, it’s hanging in right at the 50-day moving average. Now their earnings are due to be released on April 28th, that’s 21 days from now. That’s plenty of time for this stock to work. It’s also not lost on me that the stock is up only 17 cents, big deal. But the rest of the market was basically down, and so this stock is under pressure from below. In other words, it’s being bought. And so I want you to consider taking some of this stock. Because the stock is at such a low price it’s like every penny counts. So when you’re looking at your risk, if we look at this level right here as our support at like $11.00, the stock is now at 12.29.
So if you are buying this stock right now, you’d really want to have your stop below $11.00. That would actually make this kind of a higher risk trade from a percentage standpoint. I like to have stops, at least on the initial trade, much tighter than 8 percent. You could maybe put a stop up here instead, where you’re really just looking at, you can see it over the last three bars or so. You just want to have some kind of risk mechanism in place because you’re still anticipating here. We’re waiting to see if the stock is going to breakout. It might not. This is a little bit of an anticipatory trade. It’s a, wouldn’t it be nice if. Kind of like MPC ( NYSE:MPC ), same kind of deal, trading along the 50-day moving average and starting to perk up a little bit. So we’re seeing the same thing with GoPro ( NASDAQ:GPRO ). Anyway, I just thought I would just pass that on to you with some ideas on risk management.
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