Is it too late to grab Harte-Hanks ($HHS)? Not if you trade it this way. (June 29, 2022)
HHS
I want to look at Harte-Hanks ( NASDAQ: HHS ) here, you can see what’s going on. It’s tempting and it certainly is natural to look at this and say, well, I missed the move. You look at the weekly chart and it does look like it’s run quite a ways. But as I look at this I want to do two things, we will talk about how to stay with this trend for longer. And then I also want to show you some things in this chart; let’s just talk about this now.
This stock has come out of this volatility squeeze right here. It was actually two squeezes, a squeeze followed by another squeeze and then this thing just exploded. You can see the kind of volume in this stock, Now, typically, like back here, it didn’t even trade 3,000 shares. Here, I will bet one of these days was even less than that, yes, 1.7. This has been a very, very thinly stock. And then suddenly you got your first inkling that something was going on back here, maybe even back there when volume ticked up quite a bit.
But the stock really took off when it blasted through $9.00 and that was just at the end of May. And since that time the thing is up over 30 percent. The question is, can this continue to run? My answer would be, yes I think it can. First of all, you have got to give it a little room, if you are going to take this stock. And you want to look, this is the 20-day moving average. You want to give it plenty of room, even say, down to the 20-day moving average, which would be 15 percent, give or take.
And you also want to look at volume, it would be tough to buy this stock tomorrow with the stock where it is right now, However, this is one way you could do it. Instead of just looking at the slope here, like all of this stuff, you look at the intraday lows. And what you are seeing is, this was an intraday low back here, a really low, low. And then we get a higher one, a higher one still, a higher one still, and another and another, and another, and another, and another.
So you have got to look at this right here, the intraday low of 11.00, we’ll call it 11.50. That is the reference point for the power of the bears. In other words, each day that is going on the bears, the sellers have become less powerful than the day before, relative to the bulls. The bulls are just buying the stock, anytime the stock comes down a bit the bulls buy it. And so with each passing day that intraday low is a statement of exactly just how far our sellers will push that stock before all the supply is soaked up.
One way that you can be trading this is actually pretty simple. You want to trade and rely on this pattern continuing, of higher intraday lows. That tells you that the trend is still intact. If you get a lower intraday low, then that tells you the dynamic has changed. It doesn’t mean that the move is over, it just tells you that the dynamic has changed. And so you can be buying this stock here and you keep your stop below 11.47. Don’t put it right on the money, but 11.35 or something like that. Suddenly you are taking not very much risk in getting into a high momentum stock.
So this is a trade I think could still work, I wish I had caught it before. The way I look at these is, that you look for these really tight Bollinger Bands, close to a key moving average, and then you buy them on the high-volume breakout. You’ve got that here, you’ve got another one here, and even another one here. There is so much to be learned from this chart but I think there is also a lot of money to be made too.
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