Feel like you’re arriving late to the party? It depends on your timeframe. Let’s look at Coherent (COHR). (January 18, 2018)
COHR
I want to take a quick look at Coherent ( NASDAQ: COHR ). This is a stock that we put on our Growth Stock List back on October 12th, if I am not mistaken. We are up 26 percent since then, about $65.00, which isn’t too shabby.
So how are you going to trade this from here? Let’s say you bought this here; you should still be holding and hopefully, by now you might have a full position. Perhaps you kind of loaded the rest up when it was here. If not look to buy more when it moves up past yesterday’s high, we’ll call it 330.00, and then you are off to the races.
Now, why would I say that? I am assuming that most of you watching this video are not long this stock so I will tell you why I am telling you about it. The weekly chart really shows that this stock is just breaking out of a pretty substantial consolidation phase. It has got about 98 bazillion bases and resting periods in here after really starting to move in early 2016. You can see the increased volatility and volume here, that is institutional activity. A lot of them are buying here, they are holding and now they are selling.
That is just kind of the way institutions work, they don’t usually buy at the bottom and they absolutely don’t sell at the top; they try to get out a little bit early. We could be seeing some of that, no question about it. But, this move above 300.00, you are less than 10 percent above that, just 5 or so. This move above 300.00 is a pretty good sign that there is more buying to come here. They don’t report earnings for a couple more weeks and so I think if you want to just initiate a position you could do it here. You may want to wait until it moves a little bit higher in volume. Or, you could just take some stock, take a small position and give it a little bit of room, it shouldn’t fall back below 300.00.
That is how I would trade Coherent ( NASDAQ: COHR ). But one thing to keep in mind, these growth stocks that I cover, they are growth stocks. We have particular parameters that we are looking for fundamentally and then we look at charts. You could have a stock that has the greatest fundamentals in the world but if the chart stinks then you have to pass on it. Because we are not looking for that hidden gem that no one else is finding. We are looking for that gem that institutions have and they are starting to buy it.
The only way you can tell that is in the chart. And if the stock is moving up, if it is trending higher and the fundamentals are awesome, that means that institutions are buying the stock. They have to pay up for it because they need a lot of it. As they buy more stock it reduces the number of actively trading shares, the shares in the float. So this is one of those I think has those characteristics; I think it is going higher.
Free Chart