You like March Madness? Check out DraftKings ($DKNG) – March 18, 2024
This is Dan Fitzpatrick at StockMarketMentor.com. Let’s look at DraftKings ( NASDAQ: DKNG ) today.
A couple of our members were talking about this this morning, and covering it in our trading room. I looked at it in our training session as well. This looks like a pretty good setup here. This is why, first of all, it’s the whole March Madness thing. This is when all the college basketball players, the ones that actually love the game, as opposed to the money, play for the national championship and all that stuff.
DraftKings ( NASDAQ: DKNG ) usually goes up at some point during that month. I’ll show you this, but first of all, the trade here. The high here is 43.87, so frankly, in my book, your entry is 43.88. If the stock breaks above today’s intraday high, I think you want to take the trade. Your stop would actually be below today’s intraday low, which is 41.86.
Basically, what I’m looking at is, I need to see a stock that does not just completely reverse. If it doesn’t completely reverse, then that makes me feel good, and I would be buying the stock, so that’s the trade. But let’s go back and look here. In March of last year, it wasn’t toward the end of the month that the stock started moving higher. And mind you, this is all just based on technicals, like what we’re seeing here.
This is a technical trade, and I’m talking about the tendency of the stock, ultimately, to move up in March. Even this down-trending time here, this over here, look at what happened in March. Early March, yuck, and then from the mid-point on, a really, really nice move higher. We can go, basically, all the way back, here at some point during the month, this opened up and went nicely.
But towards the end of the month, you got absolutely creamed if all you were doing was saying, hey, it’s March Madness, I’ve got to buy this stock. That’s not the way trading works. I’m talking about this right now for this, this is a trade that you want to take. Just make sure you’ve got a good risk management program in place, so that you’re not opening yourself up to too much risk, for too little reward.
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