Check out Garmin (GRMN). Using your GSP tracking chart system, it’s close to being the right time to buy this stock. (August 03, 2018)
GRMN
I want to look at Garmin ( NASDAQ: GRMN ) here. I happen to be wearing the Garmin Fenix 5 watch; I am quite enamored with it and I will actually like it a lot more when I learn how to use it. Anyway, I have been looking at the stock here and this looks like it is really poised to breakout nicely.
The good time to be buying this stock, and of course we can always be looking at this in hindsight and say this but these are principles that work on uptrending stocks. If you look at this weekly chart here you will see the 40-week or 200-day moving average defined support. The same thing here, defined support. So this is a stock that has really been in a trading range, along the 200-day moving average, for this whole year; so we are about to break out.
I am setting an alert at $66.00. If this stock starts breaking out above $66.00 I think we are seeing the start of the next leg higher and I want you to be there. This is a weekly chart; you can see the volume here, which is because they reported earnings. The next earnings aren’t, basically, until the elections.
Let’s look at the daily chart. You can see it’s quite a bit choppier here. But the whole idea, at least the way I trade long-term positions is this: I will look at the weekly chart and I will decide if I want to buy the stock; and the answer is, yes, I do. And then I look at the daily chart and I try to then craft a plan for actually executing the buy. IF the stock pulls back towards the 50-day moving average that is my time, if it does it, that is my time to initiate a buy; to start buying a stock I want to buy a stock with promise, with potential here, on a pullback.
Now, ideally, it would be a pullback that would look more like this, where the stock is just really not so choppy but it is really just trading sideways. Not that much distance between the lows and the highs so it is not really a pullback it is just kind of a little drift sideways. We don’t quite have that here with Garmin ( NASDAQ: GRMN ). But again, the weekly pattern controls for me. It also controls the time frame. If I am buying here on this weekly chart I need to be able to stretch this out into 2019 and take advantage of what I think would be a nice move up into the high 70s. It’s not a huge move but it’s a move.
Now we look at this here: Again, if the stock pulls back, that is when you would start a position. If instead, it breaks out, again, I have an alert set at $66.00, if it breaks out above $66.00 and I have not initiated a position yet because I didn’t get an opportunity to, I will still buy, it is just a different plan. I will take a very small position just in case the stock does not come back because it has done that type of thing before, back here in 2017.
If you were waiting for the stock, it is up here around 55.00, looking to break out and you didn’t see the stock until right now and you are waiting for one last pullback to the 200-day moving average, well you are still waiting. You finally did get your opportunity to buy at the 200-day moving average; the only problem is it is about 8 percent higher. So we always need to be able to have, basically, two plans. One, a pullback buy. The other, a breakout buy. Either way, you are going to start with a smaller position and then just look to build from there.
That is how I would trade Garmin ( NASDAQ: GRMN ). But even if you are not trading it keep an eye on it and keep an eye on it in this weekly time frame. If this stock starts trading to $66.00 I think you are going to see it move a lot higher from there.
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