Key Level To Watch For Bounce in El Pollo Loco Shares of El Pollo Loco ($LOCO) came public last week and has had an incredible run, more than doublining from the level of the first trades. Over the ... more
Key Level To Watch For Bounce in El Pollo Loco Shares of El Pollo Loco ($LOCO) came public last week and has had an incredible run, more than doublining from the level of the first trades. Over the last two days, the stock has begun to pullback and now many people are anxiously looking for an entry level. I prefer not to buy stocks as they are in pullback mode, but instead look for potential levels of support where buyers may show up and then monitor the stock closely for actual evidence of stabilization at those levels before putting money at risk. One level looks like it has the best potential for support to be found and that is down near the volume weighted average price (VWAP) since the stock came public. The VWAP for LOCO is represented by the puple line on the chart (currently at 32.26) In addition to the VWAP since the IPO, the 38.2% retracement of the publicly traded range is found at 3285. My plan is to watch the stock closely under 33 and to look for signs of stabilization on a shorter term timeframe and then to buy only when the stock begins to turn back up. Succssful traders ANTICIPATE all potential scenarios but then wait for price confirmation before they PARTICIPATE. No plan is complete without a stop either, know what your acceptable risk is in advance and honor your stops! less
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ALPHATRENDS.NET - Only Price Pays!
Tue, Sep 23, 2014 8:25 PM EDT