Here’s your trade on Copart ($CPRT) (September 18, 2019)
CPRT
Just a quick video here on Copart ( NASDAQ: CPRT ). Copart ( NASDAQ: CPRT ) is one of the few stocks that is on our active Growth Stock List, which are basically trades that I suggest and we wait and see how they do. Anyway, I just want to go through this with Copart ( NASDAQ: CPRT ).
You see the squeeze, the type of thing that this squeeze is, it just popped right out of here on the 5th. It has held the breakout; you can see it closed on that day, on the 5th at 80.61. And since that time the stock has come back to test that level on 4-5 different occasions intraday and it has actually held each time. So in this kind of dicey market, the way it has been, this is a pretty impressive stock. I can’t suggest that you buy it right here. And every day when I post a Chart of the Day video it’s not like, hey, here’s a buy of the day, I just want to go through some chart analysis and talk about trading here.
So my thesis on this particular stock is, that okay, it has been a pretty significant move here from 45.00 up to 80.00, it is almost a double this year. The fact that the stock broke out and then is holding tells me that there is not a lot of institutional selling going on, if there was you would see this thing really gyrating around a lot. As the lemmings buy right at the top because they want to get in on a good thing. And then the big money guys are willing to dump into any demand. That’s really not what is happening here.
Instead, the stock has a little bit of profit-taking, the stock is finding new buyers here at $80.00 where before there were sellers at $80.00. So this is actually a very, very key distinction; it used to be down here was the range, well now, it is kind of looking like this is going to be the range. I would say as long as Copart ( NASDAQ: CPRT ) stays in this channel that’s the way you want to hold the stock. A very, very loose stop, frankly, would be a little bit below the 50-day moving average. If it’s me, and this is the way I am trading it, I am going to keep my stop just a little bit below $80.00. If this falls below 80.00 then it is kind of in jail and I just don’t want to be holding that stock.
Free Chart