Here’s how I’m trading Palantir ($PLTR) – August 17, 2021
PLTR
I’m looking at Palantir ( NYSE: PLTR ). Why is that? I will tell you why, because I look at it as an IPO. It has been trading less than a year, you see the kind of move it’s made. A lot of money to be made back here but none of it right now. That was yesterday, this is today.
But what I am looking at here is the fact that now we have a 200-day moving average, we’ve got a 50-day moving average. Great, they are clustered together, they’re stacked. They are in this moving average stack right here. And on top of that, we have the 20-day moving average, that’s the little thin blue line here and that is this middle Bollinger Band.
So we’ve got the 200-day, which is the wide blue line, the 20-day, which is the skinny blue line, and we’ve got the red, which is the 50-day moving average, within 5 percent of each other and the price is just barely right here. So what we really have going here is kind of a bona fide squeeze.
Now, you could say, and you would be right, well Dan, the real squeeze took place back here. Okay, yes it did, missed it, sorry. But the stock now is done, it has gone through this phase, these 3 phases of a squeeze that I discuss all of the time, which is, here’s the squeeze.
And then you could say either the Phase 1 breakout is right here. The Phase 2 pullback is right here. And then the Phase 2 follow-through to new highs is right here, yippee ki-yay. Then we get another pullback and we are off to the races, you could say that. Or you could say, well, this is actually the Phase 1 because this is just a brief little pullback and then this is the Phase 2, stopping at the 50, and now we are looking at a move higher.
The thing is, it doesn’t really matter. It is kind of like that stupid Elliott Wave Count, what the heck good is something when you are always having to change the count? That’s the thing that has always been amazing to me about the Elliott Wave proponents. It’s a religion where, on the wave changed, oh, well now I am recounting. Sure, great.
That’s not the way we trade, we trade on probabilities. And my probability tells me that now this stock has popped up above the 50-day moving average and has pulled back to here. I am saying that right now is probably a pretty good time to really watch this very closely because if there is buying that comes in here and props the stock up, then your next trading box is right here, which means that now you are buying near the bottom of the box and you are expecting this kind of move.
So the takeaway from this is, this is still in a basing pattern but the fact that it’s got a moving average stack, 3 deep, 50, 20, 200, and the price is right there in the middle of them. That is an explosive situation, still, and so watch this stock. I will set this alert for members, the real breakout would be above here, it would be above 25.76. But what I like to do is give myself early alerts so we will set it at 25.12, something like that. That is not a buy signal, that’s a “look at me” signal. Members, when you get this email at 25.12, all the email is doing is saying, check out Palantir ( NYSE: PLTR ) because it might be breaking out.
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