Evening folks. Here is a video review on our trade in KV.A. This is a very powerful setup which we call a range breakout. Kv.a is a stock we play often and since August its been in a range where it can not top 1.95. Its tested that top numerous times but just cant get past. Due to a big sector run in bio’s and and overall bullish market towards breakouts when Kv.a hit 1.80 on friday we took a position for the range breakout. One of the things to remember about this type of play is that the more times it tests the area and the longer the range/base is the more powerful the breakout will be.
When thinking about breakouts remember that price has a memory and those memorories is what leaves us areas of support & resistance. That battle between bulls & bears at certain key levels is what forms big areas of resistance. Judging from the daily chart on kv.a that 1.8-1.9 level is one of those key battle ground levels. Once that area cleared that completely put the bulls in control of this rangebound stock. This is how trends are formed. You go from a big downtrend to a more nuetral range (stocks base for months) Once that base/range breaks now that nuetral range has been overcome and a potential uptrend can start.
WE bought this stock at 1.81 sold 1/3 at 2.03 and 1/3 at 2.33 and 1/3 at 2.09
I give myself a B+ on this trade. I could have timed it better and just bought it today instead of holding it from friday. And the other thing that i reall should have done is sell off all my position in the 2.2-2.3 range. that was a big spike that took it from 2.05-2.3 it happened to quick and too fast.
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