Let’s give a round of applause to TwoFiveNine for being this week’s Featured Trader!
TwoFiveNine has been a member of the Investagrams community since 2018 and has been very active as he has already posted more than a thousand times, always sharing his thoughts on views on some of his trades.
A few days ago, our featured trader posted his trade idea for PSE:SPNEC. A new addition to the PSE, PSE:SPNEC debuted strongly during its first month of trading. However, even this stock wasn’t safe from the sell-down that occurred across the whole market.
As PSE:SPNEC opened at a price of 0.95 per share, it easily gained momentum and rose by over 146%. From its peak, the stock fell by as much as 37% as bad market sentiment took over. Finding support around the 1.5 area, TwoFiveNine saw an opportunity to do a bounce play. As PSE:SPNEC retested the 1.5 support level, he saw an opportunity to play the bounce as prices broke out of their most recent daily highs.
TECHNICAL STANDPOINT
In terms of price action, PSE:SPNEC looks to be consolidating gains from its previously strong rally. Although it is uncertain whether this will be a reset for an uptrend continuation, its big trading range offers opportunities for traders to do some swing trades.
TwoFiveNine recognized that the bounce could only be a swing trade opportunity, so he made sure to lock in gains whenever price reached different resistance levels. As prices reached his first target, he made sure to lock in some gains already.
As prices continued higher, he already sold all of his shares as prices reached a bigger resistance level. TwoFiveNine played it smartly as during times where bearish sentiment is rampant in the market, it is highly advisable for traders to lock in gains as early as they can. Although it isn’t impossible that strong breakouts can emerge, the chances of one happening are low while most of the market is strongly moving lower.
FUNDAMENTAL STANDPOINT
PSE:SPNEC is a renewable energy power generation company that mainly constructs and operates solar power plants. The company produces electricity from its plants and sells it to customers or on the market. As demand for renewable energy keeps on increasing due to global warming, the company is in a good position to benefit from the likely global shift towards more sustainable forms of energy.
What should be my next step?
As was mentioned, most traders should have already locked in gains as prices are already at resistance levels. Should you want to look for a breakout play, it would be advisable to wait for market conditions to stabilize and for bulls to regain some control. If you are looking for a swing trade, it would be best to wait for prices to come back again to support levels. However, keep in mind that the risk to reward for the play will most likely be lower the next time a bounce from support occurs.
Once again, KUDOS to TwoFiveNine for being this week’s Featured Trader! Enjoy your 14-day InvestaPrime Access and continue to be an inspiration to the trading community.
