SKX trade for 11/16 – 11/18/2015

Posted By on Nov 18, 2015 | 0 comments


When a stock gets punished severely and looks like a 'buy' fundamentally as well as technically, that's our queue to step in and take a long position.

$SKX (Sketchers) drifted almost ten days in a row down starting in early November 2015, from $31s to $24s, a -23% slow death. On top of that, the stock got slaughtered -35% during the month of October with no price rebound taking place. We saw a nice opportunity for a swing trade in $SKX in the $25 area. Since our conviction was very strong, we decided to go a little heavier than normal in the swing position. We ended up scooping up a total 10,000 shares of $SKX, adding on the way up into strength (a bit of trend trading here). The charts were telling us that a short squeeze was imminent in the name and our tape reading pointed out that massive accumulation of the stock was occurring at the bids, a sure sign that the stock was being patiently bought and ready for take off.

As the stock kept running up, we eventually sold off piece by piece into strength locking in well deserved profits. End result was a net profit of $20,470 in just only two days! When your conviction is strong, go larger in position size to reap bigger gains.

skx2

Submit a Comment

Your email address will not be published. Required fields are marked *

%d bloggers like this: