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Jeff Pierce
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I’m a swing trader of momentum stocks with a holding period of anywhere from a few hours to a few months. I run a number of screens to locate the strongest/weakest stocks out there, using technical analysis to determine my entries and exits. Trying to calculate the intrinsic value of stocks in... More
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  • Using Upper BB To Exit Momentum Stocks 0 comments
    Oct 29, 2013 8:35 PM | about stocks: FB, GPN

    By Jeff Pierce

    After a stock releases earnings and it's received favorably by investors, generally 2 things happen after the initial pop higher.

    1. It just keeps going higher as in the example of FB below.
    2. It pulls back briefly and then continues higher (GPN).

    (click to enlarge)

    (click to enlarge)

    In both cases you need to find an entry if you want to play these sort of stocks and more importantly determine a strategy for exiting them. In this example we're focusing on GPN as I was in that position until a few minutes ago when I sold at $60.02. My reasoning for selling is that is was above the upper bollinger band on many time-frames I watch - nearly all of them except the daily, and give the nearly vertical move I wasn't going to hold out for another .50.

    Here is a good look at the 4 time frames I watch showing where they're above the upper BB. (click to enlarge). In my experience this has been a good reference point to determine short term overbought.

    (click to enlarge)

    tradewithZEN is now available on Ditto Trade and if you want to automate your trading by combining my trading style then you may want to look into this.

    Stocks: FB, GPN
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