Freaky Fast Outlook (LVGO, MNST, MSFT)

Man, I love Livongo! We’ve been in LVGO since $55 following its very bullish reversal day on May 27. The key for me to trading this stock is to buy after the bullish reversals near the 21-day ema, and to take some profits on the big up days. I’ve highlighted three of those reversal days below. You can also see on that chart how quickly it demolished my first three target prices.

This thing is amazing. How far can it go? Who the heck knows. It reports earnings on Thursday after the close. I may get out of it all, or I might hold less than half of my remaining position. No need to be greedy. Like Cramer says, go buy a cashmere sweater. I’d love to see a good earnings report get sold off, so we can buy it back lower.

I’ve got one Sept $80 call in MNST, the energy drink company. It reports earnings Tuesday after the bell. We paid $125 for this and it’s currently worth $272.50, so we’ve got well over 100% on our money in just a couple months. The initial plan was to sell this the day of the earnings report, so I should probably stick to that. But I still feel like this is heading for that $83 target at least.

What we could do instead is to sell an Aug $82 call against it for the same price ($125) that I paid for the Sept $80 call. This would give us a freeroll on the following profit outlook.

I’m not sure which option I’ll pick. Perhaps the market will make it easy on us and this will run near $83 by Tuesday’s close. That would be a quick $275 or so. Dreaming is free, right?

I’m not much of a fan of buy and hold as a trading strategy, but Mister Softy (MSFT) seems like the ideal candidate for doing exactly that. Check out the weekly chart.

I picked up a small position on Friday at just over $200 and it made a picture-perfect close on the daily chart. Look how it tested the old swing high from that highlighted candle from 6/10, found support there just above the 50-day moving average, and rallied back above $200 to close at the top of the daily range and above its 21-day ema. Perfect setup. You’ve got a nice, easy stop loss below $197, so you’re looking at a 4% max loss. Next up should be $226 and if all remains right with the market, a run to the high 200s is reasonable. I’ll hold this until I get stopped out, or more likely, until I get bored with the slow, steady profits.

I’ll be back later with NET, NTAP, NVDA and PYPL. Feel free to leave any questions or comments below.

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