Here’s your trade on Transdigm ($TDG) (November 20, 2019)
TDG
I want to look at Transdigm ( NYSE: TDG ) here today and here’s why: The stock is up again on kind of a sluggish market day, particularly in tech. This is going to be a quick video because I don’t have much to say but it’s important that it’s said.
The company reports earnings on Monday or maybe it was Tuesday morning, I can’t remember. The bottom line is, the stock trades down; a big gap down, it traded down to 552.00 or so on the daily chart, actually lower than that as I look at this. This was a real crappy day here between Monday the 18th and then the open on Tuesday the 19th.
Then what happens? The stock ALMOST immediately rebounds and actually closes up on the day, not very much but enough to make this a green box here. So we got a complete rejection of the sellers by buyers who came in and said, “Dude, I will take all you’ve got at 550.00, 560.00, basically up to about 570.00.” And then today we have an even more determined group of buyers that are pushing this stock up to all-time highs.
I mentioned to our members that you want to be buying this stock back here. Now the stock is up quite a bit and it’s not REALLY a safe buy here unless you are an active trader. If the stock, though, pulls back a bit, the closer you can get to this low here of 544.00; the closer you can get to that the better risk the trade is. In other words, it’s a lower risk just because you know where your stop is, right down there, and a higher reward; because this stock has formed one big monstrous base, with a volatility squeeze in the middle, over the last 4 months, so I think this stock works.
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