Looking for a new stock to trade? Here’s your trade on WhiteWave Foods (WWAV) (May 19, 2016)
WWAV DF WWAV
I want to look at WhiteWave ( NYSE:WWAV ) here, and the reason is actually the chart. This is kind of a thing of beauty. The stock had been consolidating for a while, churning around below the 200-day moving average. Either tomorrow or Monday you’re going to see a crossover, the 50-day crosses above the 200. These are intermediate and long-term moving averages, so all this really means is, the stock has been moving up for a while. If it was the 5 and the 20, that would be a different deal, shorter-term stuff. This is something that technicians look at and so I’m looking at it too. But what’s compelling about this stock is, this was resistance right around $42.00. The stock broke out and has pulled back, hasn’t hit this $42.00 level yet. I think this is a stock that you can buy right here. Take a small position, I would suggest doing it and keeping your stop even below the 50-day moving average. That’s kind of a little bit looser than I prefer to, but the way you do it is, take a smaller position to begin with.
Take a small position and then if the stock pulls back you feel more comfortable adding to it, not as the stock pulls back, but as the stock bounces AFTER a pullback. If it’s just pulling back don’t buy it because you don’t know how far down this thing is going. But if it’s just pulling back and then bounces off of, say, the 50-day moving average, now your stop’s is intact, you bought more stock and you’ve kind of got a better trade going. But what we’re doing now is, just looking at this on the initial breakout pullback and we could see this stock continue to go and challenge 50.00 or 52.00. The reason I came to this stock, because it’s actually not one of those that I follow, is because of the Phil Mickelson deal, he has an issue with insider trading on WhiteWave ( NYSE:WWAV ) and Dean Foods ( NYSE:DF ). I’m not going to get into that here. It is what it is, I get it. But in any event it just got me looking at these. And Cramer mentioned it too. Dean Foods ( NYSE:DF ), choppy, choppy, I don’t really care about that. But WhiteWave ( NYSE:WWAV ) is a totally different thing, I like this pattern.
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