A big number from Nvidia (NVDA). Here’s your big trade. (November 10, 2016)
NVDA
We are looking at NVIDIA ( NASDAQ:NVDA ), and here is why: The company reported earnings after the bell and the stock is up like 15 percent, really? You look at the after hours stuff and you can see what happens. This company reported earnings that actually surprised to the upside. Here is the thing though: I would be inclined to sell into this or keep a really tight stop. Probably error on side of the tight stop. Here is why: I remember when they reported really strong earnings here too, and the stock gapped up about half of what it did this time around, and it just kept going. And then they reported earnings again, and this time it gapped up, drifted sideways, but ultimately it has just continued to move higher.
So why call the top on this? Now, that is a reason for putting in a trailing stop. Why call the top in this? I will tell you why. You can see how this thing is extended, it has really pulled away and at some point, at some magical moment in time, this stock is going to get ahead of itself. When you look at the weekly chart and then you see that the stock is up here, this is what this thing is going to look like tomorrow, it is going to open up right up there. Doesn’t this seem like a pretty good time to be selling? Right at around $80.00; unless you want to hold it to 100.00. That is fine if you want to do that. I would suggest this: Forget about this as a reference for stops. Go to the daily chart, if this stock even pulls back to 73.50 or so, that is the top of here, it is probably going lower. So I would even have my stop tighter than that.
Basically what I am trying to do is talk you into selling the stock into strength. But if you are long lets just do it this way: Upper Bollinger Band, 75.43, lets edge it up and say it is 76.00. If this stock pulls back to 76.00 you don’t want to be in this stock because it is probably going to continue to correct. Because the only reason it would be down, think about it, the only reason it would be down this far, after such great numbers, is because everybody else is selling into strength. DON’T NOT BE AT THAT PARTY. Me, I would even take it a step further than that. Again, I am trying to talk you into selling this stock into strength. See the kind of move that it has had? I would even go 77.00. If this stock falls below 77.00, I would be selling it tomorrow. That is my take on it.
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