Today, I’m going to show you how to trade a high-flying stock.
This is a stock that recently came right out of the box with its initial public offering (IPO).
After an initial pop, it went through a lull. But, whoa! Now it’s up strongly, with more in the works.
You can buy a winning stock – even at what might appear to be a higher price – if you follow my rules.
That’s what I’m going to present to you today and the stock to trade for more gains to come.
But before I do, keep an eye on one of this week’s Watchlist stocks: Skyline Champion Corp. (SKY).
This is the factory-build housing construction company out of Elkhart, Indiana.
Modular and component builds are gaining right now for the single-family and multi-family markets as demand for homes remains hyper-strong.
Skyline is one of the best in this segment. The stock is up so far this week as of this writing by 1.88%, and there should be more in the works.
Now, let’s get to the details on how to buy a stock having a nice run…
Another High, Tight Flag
The stock is Monday.com (MNDY).
Monday.com is a Tel Aviv-based technology company from one of the global centers of brainiac technology – Israel.
Specifically, Monday.com specializes in software and services that empower companies and teams to be best managed, including communications and product management.
And with the globe embracing remote work, Monday.com is right in the thick of what the world’s business community needs.
The company came to the public market with its IPO that began trading in June, and investors are showing a heavy appetite for it.
MNDY made a quick pop to around $240 before forming its first base. Two months later, the stock broke out and made a huge surge.
Here’s the chart set-up…
Now it has come back inside.
Price action has tightened significantly over the last few trading days. And I am using this area to “cheat” with a low-risk entry point.
How I’m Trading The Stock
I bought at 380.00. And my stop is fairly tight on this one at 356.00.
I’m trading a consolidation inside of a consolidation to try and get in early.
This way, if the stock makes new highs, I will already be up 12% with a nice cushion.
The stock climbed more than 100% in under eight weeks, so it qualifies as a high, tight flag set-up.
The rule-based entry would be buying at new highs if you want to play this one by the book.
Embrace the Surge,
Ross Givens
Editor, Traders Daily Direction
Sky is a little choppy. MNDY demonstrates my great ideas. I hate stops because it wipes me out at the spring point like a pogo stick. I love stops when a symbol tries to take my money.