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I'm Dan Fitzpatrick at StockMarketMentor.com on Monday, March 11th.
I want to look at Cree ( $CREE Cree, Inc ) today.
Just a little while ago the CEO of Cree ( $CREE Cree, Inc ) was on "Fast Money"
talking about how they've basically got the company and
the industry off high center
and he thinks they're in the sweet spot
to move forward.
The question is, I mean that's fine, so maybe this is the time that
you want to go see if you can get a job
with Cree ( $CREE Cree, Inc ).
But, as I'm looking at the chart, this is a stock that's just scary.
A lot of folks will look at this chart and say, "Oh my gosh, this is
a beautiful chart, look at this chart, it's such a beautiful chart, I mean you can
see
this nice bowl pattern here,
oh, it's such a beautiful chart."
Well yeah, if you'd bought here, or here,
or even on this breakout at $35.00. By the time the stock is
up to here,
this is not the time to be getting long this stock; it's the time to be taking
profits if you are long.
Showing up on "Fast Money"
after the stock has made this kind of move, not before, but after the stock has
made this kind of move, showing up on "Fast Money," in my mind, almost makes it
more dangerous that it's a top, because what are they going to do next? Be
interviewed by Leslie Stahl on,
I don't know whatever show she's on that nineteen people watch.
What I'm saying is,
the stock is already so extended that I don't really know what the next catalyst
is that's going to push the stock higher
versus cause it to drift sideways or even lower.
Now, notice I've been talking about the weekly chart. For you more aggressive
traders, hey, follow me.
Now we're looking at the daily chart,
volatility squeeze, right here, boom! Big break out.
Okay, this is really kind of conforming to our
three-part volatility squeeze,
you
know, breakdown or analysis that I do. First of all you've got the squeeze
itself,
the breakout, out of a Bollinger Band squeeze,
that's phase one. At some point the stocks going to peak,
perhaps that was it last week,
we don't really know yet,
but if it does,
then we start phase two, which is the pullback
phase.
It could pull back a little
or it could pull back a lot.
We wait
for this phase two to run its course and then the first positive day,
after
an identifiable pullback,
the first positive day
we put a stop underneath
that intraday low
and trade into phase three,
which is a rebound to the up side.
Right now I can't really say whether this stock is done going up on this initial
phase one. But if you are an aggressive trader, and only if you're an aggressive
trader,
go ahead and buy this stock right now, just keep your stop a little
bit fifty-one'ish, something like that.
If you're an uber-aggressive trader
then you want to look at, say, Friday's intraday high, $53.35, is
that the high of the week? Yes, $53.35.
If the stock hits
$53.40
that is your momentum breakout, that's your breakout, you go ahead
and buy that stock
even though it's up like this, even though this chart is just, like
ugly.
And who is it ugly for? It's ugly for the folks that were shorting it and it doesn't
have that high a short interest,
and it's also ugly for those, like you, who may be wanting to enter but you
realize this is a really, really high risk trade to be trading right now. I think you
basically want to steer clear of this stock,
unless, again, if you're one of these guys or ladies
that likes to run around with your hair on fire,
there's your buy point,
right there, just make sure you manage your risk.
Okay members get over to the Strategy Session; I'm going to start actually,
with the couple short squeezes that are happening right now that are
pretty much going to print some money here,
at least that's my view. So get over there and check that out today.
A little bit different format over there than we usually do.