If you're looking to get rich quick, trading IPO stocks may be the way to go. ๐งต๐
(1) IPO bases are different from other bases like the cup with handle and flat base.
They usually have shorter length (less than 5 weeks) and smaller declines (less than 20%).
Some volatile markets can see declines up to 50%.
They usually have shorter length (less than 5 weeks) and smaller declines (less than 20%).
Some volatile markets can see declines up to 50%.
(2) In IPO bases, patterns usually emerge within 25 days of a stock's debut.
Similar to regular bases, a buy point is set by adding 10 cents to the previous high,
and the breakout should show a strong price volume action.
Similar to regular bases, a buy point is set by adding 10 cents to the previous high,
and the breakout should show a strong price volume action.
(3) If the IPO stock ranks among the top 40 industry groups, it boosts the conviction.
William O'Neil prefers IPO stocks in leading industry groups.
William O'Neil prefers IPO stocks in leading industry groups.
(4) Investors analyzing IPO bases face limitations due to limited trading history.
However, evaluating factors like shallow corrections, large price increases, strong closes on breakout days, heavy volume,
and bases formed above IPO price can help overcome these blind spots.
However, evaluating factors like shallow corrections, large price increases, strong closes on breakout days, heavy volume,
and bases formed above IPO price can help overcome these blind spots.
(5) The highest breakout success rate is seen in IPO bases. However, a few stocks may fail after breakout.
Use an 8% stop-loss rule and exit if the stock breaches the pivot price.
If there's growth potential, the stock will rebound, offering another entry point later.
Use an 8% stop-loss rule and exit if the stock breaches the pivot price.
If there's growth potential, the stock will rebound, offering another entry point later.
(6) RAINBOW, a healthcare company, went public on May 10, 2022, at โน506 per share. Initially facing resistance, the stock closed at โน450.
Instead of buying during the IPO frenzy, it's wise to wait for a base to form.
Instead of buying during the IPO frenzy, it's wise to wait for a base to form.
After three months of consolidation and a moderate -19% decline,
the stock broke out on August 10, reaching a new high with impressive volume.
The price remained above the 20-EMA, it surged 70% in three months, peaking at โน888.
the stock broke out on August 10, reaching a new high with impressive volume.
The price remained above the 20-EMA, it surged 70% in three months, peaking at โน888.
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I regularly update my latest high conviction stocks ideas, strategies, sector rotation, and market breadth analysis, so be sure to follow me for valuable insights and updates on the world of stock market.
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