Looking for a bargain? Try Ollie’s Bargain Outlet (OLLI). (November 09, 2016)

by DAN OLLI 
I want to look at Ollie’s ( NASDAQ:OLLI) here (no not the Abbott and Costello guy), this is a bargain outlet. They have a bunch of stores back East. I was bummed because I was going back East about a month ago; I thought I would step in here and see if it was anything like Filene’s in Boston, but I didn’t get to do it. So I am looking at this and the fundamentals on this company are really pretty good. They report earnings in a little over a month and what is cool for me is this: Look at the pattern: First of all this is how it has been trading, just barely over a year, right? The stock is close to doing what we love stocks to do, break to all-time highs. Because do you know what happens when a stock breaks to an all-time high? It kind of tends to keep doing that.

So here we have got this thing right around $29.00, can’t get above there, and each low is higher than the last. So it is kind of like this flat triangle and at the same time look at the Bollinger Bands here. These are measures of volatility, really, really tight squeeze, I love tight squeezes (there are a couple jokes in there but I am not going to go there). Anyway, so this is squeezing on heavier volume than it has been in a while. This is what I would suggest doing: Set an alert on your trading software, make it for like 28.70 (I will do in on mine here). You put an alert for 28.70 and that gets your attention, we will do it here for a month. If the stock breaks out, hits your alert at 28.70, then you take a look at this stock. Then if it starts breaking out to the upside that is when you would buy the stock. If it doesn’t do that, you don’t want to buy it.

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