Interesting Swing Trade Set-ups To Watch
I will be discussing some of the IPO set-ups that I have been tracking closely for a swing trade. I am aiming to capture the bulk of the price movements during the range expansion periods.
1. Yalla Group (YALA):
- Yalla Group is a voice-centric social networking and entertainment platform in MENA
- Total revenue increased 49.8% from US$42.4M in 2018 to US$63.5M in 2019; Q3 revenue grew 90.8% Y/Y
- Already profit-making which is rare for IPOs
- Social media theme is a pretty hot theme in 2020 especially after companies like Snap, Facebook and Pinterest are smashing earnings
- Ways to play: 1) Wait for possible pullbacks to retest $10.99 resistance turn support level, 2) Consolidation on faster moving averages such as the 10 EMA or 20DMA
2. Telos Corporation (TLS):
- Operates in the same space as Palantir (PLTR); Palantir has been rallying higher on massive accumulation and Telos could benefit from Palantir’s momentum
- Entered yesterday from on breakout of the downward trend line
- Ways to play: 1) Wait for a pullback to faster moving averages such as 10EMA or 20DMA. Usually, strong MOMO stocks will experience short span of consolidations at the faster moving averages. These areas of support provide an opportunity for traders to take advantage of.
3. Bentley System (BSY):
- Q3 2020 revenue growth of 8.8% Y/Y. It is not considered one of the highest quality SaaS companies, but the technical chart is setting up very well
- Double bottom pattern, coupled with MACD looking to cross over
- Balance of Power turning stronger with each day
- Ways to play: 1) Any bullish engulfing bars of the prior trading day, 2) Breakout of the downward trendline
4. Avalara (AVLR):
- Technical chart is setting up very nicely with 2 days of hammer candlestick as individual growth stocks pullback across the board
- 3 quarters of accelerating non-GAAP EPS growth: -1900%, 233%, 300%
- Average revenue growth of 30% in the past 3 quarters
- Ways to play for either swing or position trade: Follow-through of hammer candlestick high of $172.13
5. Peloton Interactive (PTON)
- 7-week pullback to the 100DMA and the stock is looking poised for another follow-through day on Monday
- Ways to play: Follow-through of Tuesday high of $115.66. I would look to scale out partially once it attempts to fill the gap during early November.
6. Asana (ASAN)
- Another software application IPO that recently rallied ~27% and it is currently consolidating on 5EMA
- Pretty strong volume coming during the past few days
- Market is already favouring IPOs, and if the broader market rotates back into software application from other themes like electric vehicles (EVs), FAANG and solar, we could this stock rise even higher.
- Ways to play: Breakout of the resistance level of $27 which is rejected on Monday.