Here’s a comfortable trade for you on Comfort Systems ($FIX) – May 8, 2024
This is Dan Fitzpatrick at StockMarketMentor.com. I want to look at Comfort Systems ( NYSE: FIX ) today.
This is a stock that has been really, really running since it broke out from this volatility squeeze. I want to walk you up to the present day. It had been trading in a pretty tight range right along the 50-day moving average. You’ll see on this day it poked up its head with lower than average volume.
But I will tell you this, this big massive volume here will totally screw this whole deal up. If we checked this and said, okay, well rather than 50, let’s just go 20, suddenly this is better. It just actually breaks out on average volume, maybe just a little bit below that, whatever is reasonable.
This is the kind of thing that you look for. And then especially once it starts running like the following day, now you have to be much more confident that this wasn’t just a one-hit-wonder. Now this is on the move, you want to be confident in holding this stock while it walks along the upper band.
Now we’re in February, I’m going to take us all the way up. This thing keeps going, and again, it started right here. Even the following day, when it got really, really obvious, it was such a powerful move that you could just stay long the stock. Now, here we are into April, where it peaked here, came back to test, and it’s just drifting sideways.
But it’s still holding, it’s holding this area here, so the sideways consolidation is a good thing, it’s a healthy thing. Particularly then, when it tests the 50-day moving average and passes that test. In other words, we look and say, all right, healthy consolidation after this type of thing, if you really want to get goofy, you could say, gosh, it’s squeezing just like it did here.
No, it’s really not. But I would get what you are looking at, it’s not a squeeze, it’s just consolidation, and then the stocks here. Now, where are we? We’re just a couple of weeks ago, the stock is holding, holding, and then, boom, it breaks out here. So what am I looking at now? I’m looking at a stock that’s been going up for three straight days, actually five.
But what I’m calling is this one, this day here. Another big breakout just like we saw back here. I think this is going to start tracking just like it did before. This company doesn’t report earnings for a few months. And so we are in blue sky territory here. I would suggest, if you’re interested in this stock, and you want to make this trade, you buy it now, you’re up a little high.
However, if prior action repeats itself you’re not up too high, you just want to make sure you have a stop loss in at the very lowest. Set it a little bit below the 50-day moving average. You can set it tighter if you want, it just depends on your trading style. But the bottom line is this, I think Comfort Systems ( NYSE: FIX ) is going to be a nice comfortable long for you.
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