Here’s what we’re doing on Coupa Software (COUP) (May 16, 2019)


I thought I would look at Coupa Software ( NASDAQ: COUP ) here. This is a stock that we have been in at Stock Market Mentor. It is not on my Growth Stock List, I wish it was but it’s not. It has given us some pretty good trades so I wanted to go through one with you here.

The stock is drifting sideways here in February, a super tight squeeze. Then it continued in March and then in April it was kind of back to being narrow again here. Then it finally broke out, and then this next little box was between 100.00 and 105.00. So you can see that just kind of gradually the stock is making this base; it has run up here and it is forming a base that lasts several months.

It is not really a cup and handle per se, though I could make that argument but you would have to squint your eyes and have a little imagination. There’s the cup and then the handle is right here; and so we are looking for a breakout where? Above 105.00. That is actually what I had mentioned yesterday, you want to look at 105.00 as a level at which we would be buyers because the stock is breaking out and getting into a new trading box.

The way I am looking at this stock right now, this was the last trading box, the current trading box is from 105.00, probably to 115.00 or so, something like that. The stock has already broken through 110.00 so if I am in this stock when the stock gets up to 115.00, I certainly wouldn’t be buying at that level and maybe even look to lighten up.

Certainly if I was in around $100.00; if I had gotten in during this last box around $100.00 or so then when it’s up at 115.00, after just a couple of weeks, depending on where you go in here, that’s really time to ring the cash register. Not on everything because the stock is working, it’s in the upper right hand corner, up in the winner’s circle here, as opposed to the penalty box. We like the winner’s circle we don’t like the penalty box. So it’s right up here and I think ultimately the stock is moving higher.

It is good to make trades, to trade around your position. When it gets up to where you think it has peaked sell 20 percent, 25 percent, sell what you want, not everything because the stock is working. But take some off the table and then look to buy some of that stock back when or if the stock rests and gives you another entry point.

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