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I want to look at Voxeljet ( NYSE:VJET )
today. This is in that
3D printer space that everybody loves so much.
You know that Stratasys ( NASDAQ:SSYS ) has been
drifting higher, 3D Systems
exploding higher, and
ExOne ( NASDAQ:XONE ) is starting to regain
this last high. So these stocks have been doing really well.
But one that's just starting to get attention
is Voxeljet ( NYSE:VJET ).
Forget about this opening day deal, the stock really
bottomed right around $30.00 or so
and you can see what's been happening since then, it
just keeps going higher and higher. Now,
our traders, and you guys know who you are,
our traders have been on this for the last several days; this is absolutely fit
my IPO strategy,
which is actually a method of analysis it's not predicting.
But the idea is, that once the stock prints an initial high,
pulls back as they virtually always do,
and even Google ( NASDAQ:GOOG ) did that, and then
starts to move higher. That's a sign that
everybody here is a winner and the stocks likely to move higher.
So some of the folks in the
forum are looking at this and saying, "You know what? I'm
afraid, it's up, it's up, it's up, oh my gosh it's up 16 percent.
I've got to get out, I've got to get out." My suggestion
was what did you expect it to do?
The whole reason you're long the stock
is because you expect it to move higher. Now,
with that said, when a stock goes up 15 or 16 percent in a day
on basically no news you've got to start looking for the exits,
at least on some of your position. My suggestion
is this, and I haven't even changed the moving averages here, but we can do
that. Let's change this to say the
8-period; we'll make it
exponential moving average.
So this is one way
you can track the stock here on the 8-period exponential moving average,
but that doesn't work that great does it? That might work
on a 5-minute chart, right?
Well, that doesn't work either, so what are we going to do?
We're going to look for the time frame
that we want to analyze this stock in, and I think a 15-minute time frame
works just fine,
and then let's start playing around with moving averages.
Okay, the 20-period moving average seems to work pretty well,
but you see what happens; the stock gaps up
and then drift sideways towards that moving average, gaps up
and drifts sideways towards that moving average again. Now this day
I'm encouraged that Voxeljet ( NYSE:VJET ) pulled below that moving average
and then closed back above it. Do you know why? Well the whole market
was kind of a little bit weak, this was a little bit later
than others because Carl Icahn made some
cautious comments we'll say, and everybody's all skittish
and so everybody pushed the sell button until somebody said, "Wait a minute,
like we didn't know that the market might be due for a correction?"
So then they bought it all back; but the encouraging thing about Voxeljet ( NYSE:VJET ) was
that the stock did indeed rally from a low of 63.00ish
all the way up to almost $69.00 in the last 45 minutes of trading,
that's a pretty bullish move. So what does that mean?
What that tells me is this stock is likely going higher,
you don't want to get too lathered up about it, but what I would suggest
doing is setting a trailing stop
on just part of your position.
Getting out all at once, because you just can't stand making
money,
is really not typically a good method, because you wind up cutting your profit
short.
So you don't want to do that, instead just set a trailing stop on part of your
position
so that the rest can run. If you get stopped out,
fine, you've still got a position. If the stock does in fact continue to roll over
then sell the rest of it
if you want. But typically what you're going to find out is the strong stock
that you're in
is going to be stronger than you think it is and so
rather than getting shaken out on an entire position by just a normal
pull-back,
instead protect your
future profits by setting a stop
on just part of your position.