Did you get in on DocuSign (DOCU) last week? No? Here’s your chance to fix that! (May 08, 2018)


We are back to DocuSign ( NASDAQ: DOCU ). Last week I covered this stock on Thursday talking about, basically, nothing but momentum, just pure momentum. I still feel that way so I am just coming back to it. You get a big move on Thursday, a gap up on Friday and then it has just kind of settled in for a couple days. It’s easy to go back and say, “Oh, I would have bought exactly here and I would have sold exactly there.”

Let’s just structure how you want to be making these trades. I remember drawing these lines, noting that this was the “enthusiasm high” here, this first day trading where the stock really broke out. And then we came back here and found this support level right at this high. Even though there are just eight days of trading it has actually traded fairly symmetrically if you can believe that. I have switched to pivot points here and you can see the stock opened right around the pivot point but then traded down to this second support level and then it just took off.

So this really did this rebound here, we will go to an intraday chart. The rebound there really did give us a really solid open right here, I am going to get rid of this line; we don’t need it anymore. It gave us a real solid buy signal right on the pullback, a rebound. Buy the stock; keep a stop just a little bit BELOW where your entry point is as long as you are trading it very technically. So you are buying here on the rebound above S1.

You could even be waiting for the stock to give you a really good sense that it is going to continue to trade higher. Then you don’t keep your stop here, back up and keep it below this level here. So you have got your trade back stopped here and then you are just kind of letting the stock move. I can’t exactly say you are enjoying the ride because when this stock is just bumping around sideways it is like the road to Hana, not really enjoyable you are just kind of moving sideways. But then right at the end you get this big move higher.

So this was actually a pretty logically trading stock. But where do we go now? This is kind of a takeoff on this same theme. Your next buy point would be on a move above today’s intraday high; we will snap that right there. So your next buy point would be above 43.70. If the stock trades above there you are good to go. Take that stock and then pretty much immediately maybe set a stop a couple bucks lower; give it no more than 5 or 6 percent, I don’t think you have to. That is how I would trade DocuSign ( NASDAQ: DOCU ).

By the way, on a stock like this, once you are in stay in. You can trade around it if you are feeling guilty because you are making too much money; go ahead and take some off the table but keep some stock in the hole man. Just hang on to some of it. You will be glad you did. You will be amazed at how fast these profits will build up by just keeping some of the stock that you own, that is in a winning position where you are saying, “You know what? I’m out. I am going to go ahead and close this position.” Don’t! Close half of it. Close 3/4 of it. But keep some of it. My bet is that in the weeks to come you are going to look back and say, “Man, I am sure glad I hung on to some of this DocuSign,” or some Apple or whatever you are trading.

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