Here’s your trade on TAL Education ($TAL). (February 08, 2019)


I want to look at TAL Education Group ( NYSE: TAL ) here. The educational stocks have actually been doing pretty well. You will note that this one sold off kind of like everything else did in December, but NOT like everything else did, maybe just a little bit. This actually bottomed back here in October and then has been working it’s way higher ever since.

The reason I am covering this is, the fundamentals here, this would actually qualify as a Growth Stock List component. It is a list of stocks that I have for Stock Market Mentor that have a combination of great fundamentals and then also good technicals.

The reason it DOESN’T qualify for that list is purely technical. It is because the stock is below the 200-day moving average. Well, that can change next week, it might; I don’t know if it will or not. I am just saying if the stock pops out above, say, $32.30, that’s the time that you want to buy the stock. And then you keep a stop, say down here; the idea is that the only reason you would be buying this stock is if the stock breaks out and that breakout continues.

That means that if the stock breaks out you buy it and then it DOESN’T continue you don’t hold the stock and then HOPE that the stock breaks out again. It is like your reason for buying the stock is because the stock broke out here, you’re in, and you think that the stock is going to continue to move. If it doesn’t you’re out.

There have been so many breakouts lately that have NOT worked. If you are trading big it is actually discouraging and it can make you pretty poor pretty quick so you want to be careful here. But if the stock breaks out above, we’ll say, 32.30, then that is when I would look to buy this stock.

Then I would want to add to the stock as a longer-term hold; really after the stock is up here a while and then it has pulled back. It is giving up a little rest, buy a little more and then hopefully, continues to move up that way. All the while the 50-day moving average ultimately moves up above the 200-day moving average and now we have got something that we can work with.

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