$STNE Warren Buffet likes it and so do we. (December 31, 2019)

by DAN STNE 
This is Scott with your Free Chart of the Day. I want to take a look at StoneCo ( NASDAQ: STNE ). As you can see StoneCo ( NASDAQ: STNE ) IPOed back in October of 2018 and more recently has developed a nice sideways consolidative base. The blue line here is the 200-day moving average and the red line here is the 50-day moving average.

In the last couple of sessions we have had really nice tight price action with StoneCo ( NASDAQ: STNE ). You can see the Bollinger Bands getting really nice and close here and the stock is holding above its recent low of 37.51. Today StoneCo ( NASDAQ: STNE ) printed a nice candle, a bullish engulfing candle on “okay” volume; not higher than average but it is New Year’s Eve and it took price above these resistance levels.

I think we are going to look for more here on StoneCo ( NASDAQ: STNE ). I would definitely have an alert set at 40.15 on STNE ( NASDAQ: STNE ). That takes out this bar of resistance here and with these nice tight Bollinger Bands we could get a volatility squeeze to the upside. Your stop on this trade can be really tight too because you are buying it because you think it’s breaking out. If it falls below that breakout level it’s, obviously, not breaking out so you would want to exit your position.

Apparently, Warren Buffet’s company, Berkshire Hathaway, has a position in StoneCo ( NASDAQ: STNE ); so if Warren Buffet likes it stockmarketmentor.com likes it too.

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