Here’s your trade on Stamps.com (STMP) (January 10, 2017)
Stamps.com ( NASDAQ:STMP ). Sideways consolidation for quite a while. Earnings, not an issue, they don’t report for a month and a half. This is a stock that has been doing, really, a lot of good things after this big pullback. I can just draw these out, consolidation right here, then a breakout, and chopping around here. Now it is in this really tight range here. There is no issue with respect to whether it is under distribution or accumulation. It is under accumulation because the stock is up at levels that it hasn’t seen since early last year. So this is a stock, frankly, that you want to buy.
I think you could buy some of this stock right now. A small position, a light position, as long as it stays above the 50-day moving average then you are okay. So you are 5 or 6 percent maybe of risk, you could keep a really, really super tight one and that is fine, a stop. But you take some stock now and then if the stock starts to push above here you already have a head start on it, right? So then you buy some more stock. This has been a fairly volatile one, it is in a resting phase now. But if it breaks above here I think this is going to get pretty interesting pretty quick and you are likely to see this move to all-time highs. I am going to go ahead and set an alert, for me 118.35, if this thing gets to that level I am going to get hit with an alert from my TC2000 and I will wind up wanting to buy the stock.