Like many stocks forming a base right now, NVDA is also a victim of false breakups and wild gyrations recently.
One may wait to test the next breakup (again) or alternatively, "buy the dips".
However we before we buy a dip, we want to check that the bullish bias for the stock is still intact, which is the case for NVDA right now:
1. pullback was within 38.2% fib retracement from its AB upswing since hitting bottom in early October (ie still within acceptable range of a "normal pullback")
2. higher hi's and higher lo's still intact
3. bullish divergence between price and RSI acting out (although I have to emphasize that bullish divergence is only predictive of short term price movement, usually next 2-3 candles)
4. lastly, a bullish morning star formation.
Go long at the next candle as soon as we have price trading just above the close of yesterday's candle with initial stop placed just slightly below the low of the morning star pattern (~ 158).
The trick to trading is not about being right most of the time but wining bigger when right and losing smaller when wrong. Hence money management (ie stop loss, position sizing etc) are also parts of equation.
Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is important! Take care and Good Luck!
One may wait to test the next breakup (again) or alternatively, "buy the dips".
However we before we buy a dip, we want to check that the bullish bias for the stock is still intact, which is the case for NVDA right now:
1. pullback was within 38.2% fib retracement from its AB upswing since hitting bottom in early October (ie still within acceptable range of a "normal pullback")
2. higher hi's and higher lo's still intact
3. bullish divergence between price and RSI acting out (although I have to emphasize that bullish divergence is only predictive of short term price movement, usually next 2-3 candles)
4. lastly, a bullish morning star formation.
Go long at the next candle as soon as we have price trading just above the close of yesterday's candle with initial stop placed just slightly below the low of the morning star pattern (~ 158).
The trick to trading is not about being right most of the time but wining bigger when right and losing smaller when wrong. Hence money management (ie stop loss, position sizing etc) are also parts of equation.
Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is important! Take care and Good Luck!
Comment:
Definitely a no-go day! Instead of going above yesterday's close, the stock gapped down in line with the very bearish market sentiment after some economic reports today. All bullish bets off for now