‌3 things I will be watching before I buy ‌$PayPal(PYPL)$  ‌ 

I admit that I am tempted to buy Paypal at current level. Surely, this is as low as it can get since Oct 2017, isn't it? How much lower can it fall? It's lowest level since inception in 2015 was $30.52. Surely I can endure a paper loss of $30+ since so many people are already enduring losses of $100+ or even $200+ for Paypal. Are you also thinking like me? 

However, having been burnt so many times whenever I tried to buy stocks blindly, I have learnt the hard way of not trading based on emotion and especially recommendations made by analysts. Most of the analysts doesn't trade and even if they do, their recommendations are probably bias to their own positions. *There is also another reason why they are called "Analysts" because they are "ANAL-YSTS"....   ‌[笑哭] ‌

Therefore, business fundamentals aside, let's purely look at the chart. Price is currently consolidating in a wedge on the weekly chart and trying to find support at $67.57 level. Whoever declares this is the bottom is certainly "ANALysts". Whether this stock is being targeted by short sellers or investors generally lost interest in fintech stocks, I have no idea. Some people would tell me based on indications from options market, this stock is going to go up etc. 

I am not going to dispute that, because whatever you say has a 50/50 chance of happening. Price is either going up or down right? How often can we get it wrong? But look around you, are there really 50% winners & 50% losers? I doubt so. The stats is more like 90/10. 

Anyway, if you decides to buy now, you must be aware that you are trying to catch the falling knife. Maybe you will succeed, maybe you will cut yourself. Before you press the buy button, I suggest you ask yourself what is your edge? Why are you buying this stock? Is there any positive news, bullish candlestick pattern, or just being able to hold the stock for at least 3-5years without worrying how much lower it falls? 

For me, I will be looking at whether the bulls can defend their support line at $67.58. If they do, can price break out of the wedge consolidation? Lastly, can they break the bear resistance level at $124.45 and reclaim 200 days EMA? I am not worried about missing out on the chance to buy the stock at it's lowest level. (Because I am not a fortune teller and I won't be able to know where is the lowest.) I am more concerned about trading with the trend. If the bulls take charge, then I want to follow them & ride the trend higher, not trying to go against the odds and be the hero to charge first. 

Finally, I need to clarify that I am not asking people to sell or buy this stock. Personally, I like the company and I used Paypal too! It has been a profitable company and seems to have good potential. However when it comes to stocks that doesn't pay dividends, it means you need to trade this stock. You need to have a price target and a stop loss. For example, if I enter now, probably I will set a stop loss at $65 or $63. If price breaks out of the wedge, I will add position and adjust my stop loss accordingly. So you need to have a trading plan, don't just enter based on your blind faith and assumed the stock market is a 1 way train ride to heaven. It's not! It is a roller coaster! 

Enjoy the ride! Cheers!