Thinking of buying the dip on Veeva ($VEEV)? Here’s your trade. (September 09, 2019)


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Veeva ( NYSE: VEEV ); this is a stock that we had made a pretty good amount of money on. We bought it back here in February and then closed it out sometime up here. I don’t remember exactly when, we definitely didn’t sell at the top, I don’t try to do that so I guess mission accomplished in that way. We did take in a good profit and then when the stock fell back here and started kind of setting up right around here my sense was, okay, it’s below the 50-day moving average, which is not a good thing, but the fundamentals are good and I do not see the stock continuing to fall.

And so I thought I’d take a little early entry somewhere around here, I forget exactly when. And then at some point, at some point up here I am thinking, okay, I took a little bit of an early entry here but it looks like I am going to be paid off, right? It starts moving up, great. I’m feeling pretty good about it and then I get this, not enough to get me out of this trade but enough to make me say, “Wait a minute, I am seeing some really nasty boxes here.” I am seeing a big red box, big red, box, big red box all of these all the way down here. This big red box, a couple of these here and now I am seeing this and I am thinking, okay well, I won’t sell but I am sure as heck not going to buy more, this is not the way healthy stocks act when they are consolidating but thanks for making me feel good when this came back above the 50.

I was telling our members that I am not liking the way this trades. If if falls back below this 154.84, which was I believe basically, like this right here, maybe it was back here, it’s just the general support level that I was looking at. If it falls below there I would be out of this stock. It’s here, I didn’t sell it, definitely didn’t buy more because this is really unhealthy action. For the stock to fall like this on volume it’s kind of unhealthy action. And then finally today the stock fell through support and so I am out of the trade. I think I lost a little bit of money on this but I don’t really remember, to tell you the truth, because unless it’s some really weird thing once I close a trade it is automatically logged for me and then I just forget about it and I move on.

So why am I showing you this? I am showing you this for two reasons, first of all, learn the lesson, stick to your stops or you will definitely get hurt, it’s just matter of time. But also, now what do we do with this stock? If it’s me, in trading in the way that I like to trade, which is essentially trend trading growth stocks, I am doing nothing with this, absolutely nothing.

However, if you are a swing trader you have a different take on it as well as some of the other stocks that I covered in our premium video tonight. The stock is deeply oversold so I could look at this and say, “Wow, it’s down 8 percent. Maybe if the stock opens up above where it closed here at 144.51, if it opens above that then maybe I will take this for a little swing trade, almost kind of like a day trade.” So you can do that, again, it’s not my style of trading but I can trade this way it’s just a little bit high maintenance. But the 150-day moving average is supporting this stock right now, that’s at 145.11. So I would say if the stock moves up higher than 145.11 you could take a small position; keep your stop below 143.51, that is today’s intraday low so you have a very well defined risk on a stock that, if the market cooperates, could give you 3.00, 4.00, $5.00 of upside. So that would be again, a short-term trade based solely on the chart, nothing else but the chart.

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