Here’s a potential trade on Twilio ($TWLO) (October 30, 2019)
TWLO
I am going to look at Twilio ( NYSE: TWLO ). This was a pretty good growth stock for us. We bought it, I think actually, right up here and then wound up selling it up here. So we didn’t make a ton of money on it but it was a pretty good trade for a few months.
The thing is about these growth stocks they work really, really nice on the way up but once they break, and this was actually the first sign that the stock was going to break; because up until then these highs were all kind of connected by this type of line. Whereas, this time the high was definitely away from this line. It should have been back up to here to perpetuate the uptrend, but it wasn’t, instead, it was here. And so once the stock cracked the 50 that was an indication that you have got to get out of this stock. And then, of course, we have had it trading lower since then.
At some point you are going to wind up seeing shorts cover or maybe even new money coming into the stock to try to catch the bottom; I have no idea whether this stock is at a bottom, it could open at 95.00 and close at 70.00, who knows? But when a stock opens this far below, it opens well over 10 percent below where it closed, that is a recipe for a potential rebound. We are kind of seeing a little bit of that already but the stock could be anywhere tomorrow morning.
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