|Plug is continuing its upward move after a couple day pullback.
A few things to discuss about this trade....
Here is the chart:
1.) Always know what your trading horizon is before you place a trade. Your objectives for the trade are very important as they tell you where to place your stop loss order and what you should expect during the trade.
What do I mean by this? You have to decide BEFORE the trade if you are going to be placing a SWING trade (which will try to capture the next FULL up move of the stock which may last from a few days to a couple weeks) or a MICRO trade where you will be looking for an in-and-out of two to three days.
I didn't mention it in my opening post, but this trade is through my RETIREMENT account where I always look at a bit longer time frame and try to catch the next major move of a stock...the next SWING. With this strategy, it is important to get in at "VALUE" which is at the Moving Averages. When a stock is clearly in an uptrend, and it pulls back to its moving averages, it is almost always a "safe" time to buy. Of course the stock will turn down at some point along the way, but caught early in its uptrend, buying close to the moving averages is your main objective.
I intend to hold this stock for a week or two and expect it to move upward toward (and then past) its prior high. My stop loss is currently below the first long white candle of a few days ago. That kept me in during a two day pull back.
2.) Notice where I purchased it at $3.03 (see prior post). If I was in a MICRO trade, I would have been looking for a smaller profit (in-and-out) and my stop loss would also have been much tighter...right below the low of the prior day (moved up daily) and I would have been stopped out for a profit.
I did not get out because my stop has not been hit yet. Now the stock has reversed and is starting up again. This allows me to move my stop loss to just below TODAY's low which is higher than where it was...thus lowering my risk exposure. If the stock drops below today's move, then I can assume that it may not continue up.
Very often, after a strong one day move you will have a small 2 day pull back before the stock continues up. Look for these as opportunities to get into the stock at a lower price before it continues its up move.
What do I expect for tomorrow?
Today was a good strong move that I think will continue tomorrow and for the next couple days. Each up thrust of a stock should take it past it's prior high of that swing and it should stair step its way back up to the prior high of around $4.85 before either bouncing back down, or breaking out above that to a new high.
Stay tuned for the next update! Let's see what kind of return I can make on this trade.
Does anybody else have anything to add?