Not all breakouts are failing. This one is working. Check out Synopsys ($SNPS) (November 19, 2019)

by DAN SNPS 
Today I want to look at Synopsys ( NASDAQ: SNPS ). They report earnings two weeks from tomorrow on December 4th. The way I am seeing this stock, we’ve been covering this in Stock Market Mentor for a while just kind of waiting for this breakout. Well, today we finally got the breakout on heavier than average volume, not massive but definitely heavier than average volume, so this is a good clean break out.

The fundamentals on the company are really good. They are accelerating earnings, revenues, and profit margins so they are not just getting better but they are getting better at a faster clip. This is the stuff that you see in stocks that ultimately do really, really, really well. Now, Synopsys ( NASDAQ: SNPS ) has already done really, really, really well. Since this low here the stock is up 75 percent. You look at where it was several years ago and it’s up a lot more than that.

This has still got really good mojo, so what I would suggest doing is, buying the stock tomorrow. I think this is in an earnings run and if I am correct the stock t going to run up to a new high prior to earnings. That kind of puts it in the sweet spot now. Like you are buying the stock here, I wouldn’t even keep a 4 percent stop on a stock like this, maybe 3 percent. Give the stock a little bit of room to pull back just in case the breakout is kind of being sold into. But one thing that we are seeing just recently is, we are seeing more breakouts actually work as opposed to just getting slammed the next day.

I think you can be long this stock here and then maybe keep a stop somewhere around there, maybe a little lower. But just keep a fairly tight stop there and then look for this kind of move to the upside.

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