Here’s your trade on MasterCard ($MA) – August 28, 2023
This is Dan Fitzpatrick with Fitz in Five. Let’s look at Mastercard ( NYSE: MA ), which has been working really well. I like that setup better than Visa ( NYSE: V ), it was just over the weekend that I mentioned this.
Mastercard ( NYSE: MA ) popped out today on about average volume. They don’t report earnings for a couple of months now, so that is not an issue. Typically, you don’t want to chase this stuff. It is always better; here’s my caveat, it is always better if you have been able to buy around the 50-day moving average. You can see how this worked well here.
The last time, if you bought up here, it didn’t work out too well, you had to hold it until today. But in a situation like this, where this has been in this volatility squeeze, we get a breakout here, I think you can still buy this stock. It paused on Thursday, that was kind of a flush. it just flushed out a lot of these buyers.
And so, this was actually just day 2 of the move, and it wasn’t a huge move. It was a little over 1 percent today, so it’s not like you are really chasing it much. Again, it would be nice to buy it on a little bit of a pullback, but I am looking at what institutions are doing, and I think this stock goes higher.
If you are a buyer right here, you’ve got a 3.6 percent risk. If you say, Well, I am just going to hold this until it tests and then breaks through the 50-day moving average. I wouldn’t even be taking this much risk on this. If you are buying this stock here you want to start with a small position, maybe keep it at 395.00ish, something like that. Just underneath, say, last Thursday’s close.
That will mean that, if the stock pulls back that far then you have got to classify this breakout as a “fakeout” and you don’t want any part of that. Nobody likes to get fooled. So you should keep a fairly tight stop and then you can be in on this stock for this kind of ride. It isn’t the perfect pattern, but the one thing about it that I like, and you really can’t quibble with it; the price is moving higher.
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