SolerEdge (SEDG) is up 220% this year. Is it time to cash in your chips, or keep holding this winner? (November 20, 2017)


I want to look at SolarEdge ( NASDAQ:SEDG). This has been a crowd favorite in the Fitzpatrick household since back here in May when the stock popped out of this squeeze. The reason this is so interesting is because this is just like squeeze central. If you look at these setups here, tight squeeze, Boom! A move higher. By the way, just for context, $14.00 here in March; now it is up essentially to $40.00, so this is a stock that is moving.

The best way to trade this stock or to have traded it is buy here and just hold this stinking thing. You don’t have to be hyperactive. Typically the idea is, you know how you have got a lazy son? I used to be that guy that mom or dad would say, “That guy could lay right next to work and go to sleep,” and that would be me. You need to be that way in trading. If a stock is working for you then let it work. Let somebody else do the buying and selling. You just need to hang onto the stock while it works like that. As opposed to buying and holding and selling and buying every single move you are going to wind up missing the good stuff.

So in this case, you look and see the way the stock has traded. It is like squeeze and then a breakout. Then another squeeze and then a breakout. I wouldn’t really characterize these as squeezes they are just kind of drifting higher. And here is another squeeze and then a breakout. And then finally here we are at this little kind of a little flag pattern. High, high flag pattern.

This leads me to your trade. It is at 38.90 now, set an alert at $40.00. And if, not when, if the stock breaks through 40.00 that is informative. It can also be profitable because it is telling you that buyers are still coming for this stock. Had great earnings, right? Monster earnings, the stock moves up. Now we have just got this little drift period here. It is moving higher, there is not a lot of distribution in this stock. Look at the selling volume; big on the day after, it is just going to kind of do that when the stock is up almost 20 percent in a day, you are going to get some selling typically. But it was on much lower volume than the prior day. And since that time selling volume has just been declining.

So this is a stock I think that works. If you are already long the stock stay long the stock. There is no reason to sell just set an alert; I would keep it even kind of back down in the gap. Give the stock room to run and my bet is it is not going to disappoint you.

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