When is it time to say good bye to a good buy? Check out Aprea Therapeutics ($APRE) (December 13, 2019)
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I just want to come back to Aprea Therapeutics ( NASDAQ: APRE ). This is probably the last time you are going to see me cover this stock because I think it is kind of done, at least for a little bit. It is a biotech stock; they had some pretty good news in one of their trials and so you can see what happened with the stock. The thing about these types of trades is they will go up fast and then at some point all the buyers just walk away; this is what you see, something like that.
Aprea ( NASDAQ: APRE ) is a fairly illiquid stock but they had a really big day on Thursday, almost 650 thousand shares traded, and that would be a big day for this. So when you look at a stock like this one of the things, for me, what I am looking at is the closing location value. Where does the stock close in relation to its intraday range? Back here, here’s the low, there’s the high. The stock closed very close to the intraday high. Here, there’s the high, there’s the low, the stock closed very close to the intraday high. And then finally on Thursday, there’s the high, there’s the low down here, the stock closed about halfway in between probably even in the lower half. And then finally today the stock closed at the low, literally at the low.
So what I am looking at here is, I am looking at a stock that even though the intraday low here is higher than it was in the prior day the fact that this had such a horrible trading day here, it just drifted lower and lower and lower. This is a stock that I think is done going up. You have to look at the amount that a stock has moved, about 70 percent in three trading days. How much do you want man? I closed mine out yesterday and I did not close it out at the top but I saw that this had gone up so much and I was kind of looking for an excuse to exit and so I did. Then I went in our forum today and I basically told people, “If you are still holding Aprea ( NASDAQ: APRE ) you really need to get some help because you are holding it for reasons other than just to make money.”
The reason I am telling you this is because I don’t want you to get caught in this type of a move, down only 6.3 percent today, which isn’t a big decline, not after the kind of move that it has had. But if you bought it yesterday on the way up it is a big move in the wrong direction. And so we want to try to get you into these stocks earlier, into these squeezes where you are buying them right when they come out of the squeeze. You want to hang on because if they have squeezed really tight you are going to get a nice pop to the upside. But at some point, the buyers are going to have bought. It’s like, well, thank you. I have all the stock that I wanted; now I am just cheerleading for the stock and cheerleaders never score.
What I am saying is, once you are a cheerleader you don’t have any impact on a stock whatsoever. You are just hoping that somebody else will come and push the stock up. So all you want to do is get in at the right time and then not try to top tick it but definitely watch the closing location value to see where a stock is trading. Has it peaked? And you really got your first sense of this yesterday when the stock traded up so much in the morning and then just kind of drifted down to close about half of that distance on the way down.
I hope this helps. Stay away from this thing. Even if it goes back up on Monday think about Peloton ( NASDAQ: PTON ), it’s doing the same thing. It gave you a great move but once the stock peaked like this, everybody that is buying the stock here, you are buying it on the hope strategy. You are thinking that the stock is ultimately going to move higher but it is giving you no sense that it is actually going to do that. The same thing here, I get no sense at all from Aprea ( NASDAQ: APRE ) here that the stock is going to move up further. Remember that at some point it’s time to take profits, and when it’s time don’t be late.
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