Wondering how to trade Veeva Systems (VEEV)? Here’s your plan. (March 21, 2017)
VEEV
I want to look at Veeva ( NYSE:VEEV ) today. This has been overextended, whether you are looking at IBD or anyplace else they will tell you this has been overextend, new highs. By the way, I love overextend stocks, as long as I own them. If I am trying to buy them it is a little scary. You could kind of see this one coming with this type of a top, it was an extended move; but you couldn’t have foreseen this coming, not yesterday. You could certainly foresee the stock moving lower, but just not like this.
So what happened here? The entire market gapped up a bit, not a lot, but it was a fairly significant gap. And then we see all this news about what is happening or what is not happening in Washington, et cetera, et cetera, and then everything starts to sell-off. Okay, fine. That is for other people to talk about, not me. What we have got on Veeva ( NYSE:VEEV ) here, and by the way, there is nothing about this company that is any different today than it was on the 13th when the stock first started breaking out. Nothing about the company that is different. It is still a desirable company to invest in, which means you want to buy this stock. We see this stock gap up, trade lower. And now, other than this last little peak here yesterday, this trading action here is essentially engulfed, certainly this day on Friday, and then most of yesterday, other than this little thing here. So this is a complete reversal of fortune.
So what do you do with Veeva ( NYSE:VEEV ). For now, I think you stand pat. Just stand aside, let this thing fall. You can see on the weekly chart it is definitely ready to fall. We have had our buy signals here. By the way, if you are long this stock from the second add, which is right around $47.00 (we will go back and look at the daily chart), raise your stop. Keep your stop on part of your position; 48.32 is your low, keep a stop a little bit below $48.00. It may get hit tomorrow or you may want to liquidate the whole thing. But, look for support at $47.00, certainly in this general area. The stock will have support for it, but this is one of those days when you sell what you can.
You sell the stocks where there is some demand, and there is demand for Veeva ( NYSE:VEEV ). You don’t want to be selling stocks that were already trending down, then you are selling into capitulation, and that is not what you want to be doing. You want to be selling stocks where there is still some demand. So you are out of this. But my bet is that you will be able to get in over the next few days, right around this area. Don’t expect this, Boom! You are not going to get that in this market. What we want to see is a pullback and then some consolidation in here. So this can last for a while. Even if this uptrend remains intact, and I think it will, this can take several weeks to kind of rest, to get unbroken.
In the meantime what you are doing is, you are looking at stocks like Veeva ( NYSE:VEEV ), some of the other stocks that you were not able to buy because they got away from you. Now is the time to start looking to scale into those. You don’t make a stand, you don’t say, “I am buying it all at 48.65.” Take a little bit, a very little bit. But essentially you want to let the stock settle out and show you where buyers are. I think there will probably be, certainly around here, again, nothing wrong with this stock, probably 47.00ish is where I am looking for.
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