While TTP favors more trend type trades over breakouts, there are instances where we will take on breakout trades, and one of those is with IPO’s. Some of these can be fresh new issues that have just come to market and have only been listed for a week or two, or they can be issues that have been trading several months to a year or so. Today we find three stocks that have attracted our attention. Lets take a look.
ICHR- Lets start with Ichor Holdings a stock in the hot Semiconductor Materials and Equipment space. The stock made its debut last December closing that day at $9.77. The stock quickly gained traction in January along with the rest of the group before finally peaking at $29.73 in early June of this year. At that point the stock went into a correction along with the rest of the sector that lasted through most of August. ICHR has now regained momentum along with its peers and looks poised to perhaps break to the upside. Consider taking a positon between $28 and $29 if accompanied by volume that approaches 1 million shares. Considering the stock is currently sporting price volatility of around 68, a reasonable initial stop would around $25. A reasonable swing trade target would be near $33.00. With earnings season upon us, be sure to note the upcoming earnings date before considering a position.
YUMC- While restaurant stocks have not been the hottest sector, China stocks have been and Yum Brands China has caught our eye. The company reported a mixed bag of earnings on Friday sending the stock lower before it regained traction and finished the day by printing a bullish candle on more than twice normal volume. The stock ultimately gapped higher Monday finishing with a gain of over 5%. Traders could consider a long position should the stock fall back into the buy zone between $41.25 and $42.50 in the next few days. However, we would avoid initiating a position below $41.00 as this may indicate a failed breakout.
VNTR- A more recent issue is Venator Materials PLC, a company in the Chemicals sector. This sector is a bit spotty but several stocks a sporting strong charts. The company debuted in late August of this year near $21.00 and immediately sold off, but reversed quickly staging a five week rally that stalled near $23.50. The stock has traded in a tight range since and tried to breakout last Thursday but was quickly turned back. A trader may consider a long position on a close above $23.50 on volume approaching 500,000.
Remember that earnings season is upon us so be sure to check the calendar before opening any new positions. That’s all for now, have a good evening and be careful out there!