To The Moon

I have managed to make some profit before the Gap up stock went southward yesterday (28 Mar 2024). $Cazoo(CZOO)$ has a good Gap Up for straight two days, 26 and 27 March 2024.

This is when I decided to plan for a trade for pre-market on 28 March 2024, in this article, I will show you what are my thoughts and how I decide on my entry price and exit price. Why I did a DCA?

How I Look For Entry and Exit Price?

As mentioned in the previous section, I did saw that Cazoo has make a small gap up in pre-market on 28 March 2024, but there is volatility when we saw Cazoo start to trade with a high of $19.84 and then dropping to low of $15.34 by end of pre-market.

I decided to enter at $17.50 just before the Buying sentiment end for Cazoo, but that is not a good move, as we saw the price decline after that. (this is done around 8pm Singapore Time)

I held on to wait for a time to perform a DCA. So just before the market open, I managed to find an opportunity when the selling sentiment ends and the MACD signal start to build up.

I make another trade at $16.00 to average cost my earlier trade. So my average cost is $16.75. I decided to put the exit trade of $19.84 (this is the high during the pre-market).

Consumer Discretionary Stock Cazoo (CZOO) Volatility

The reason why Cazoo did enjoy a nice upside in the earlier hours of trading especially before the consumer sentiment data came, is because consumer spending power is said to increase as a result of stronger job data.

But the combination of the job data and consumer data paint a different story, hence it is always important to plan for an exit earlier, and know what you want from a particular trade.

I have an imaginative cut loss at $17.00 if Cazoo does not turn up in the first hour of actual market trading. Cazoo managed to make a price surge in the first 30 minutes when market open.

This is when I managed to sell the shares 8 minutes into market open at 21:38 hrs. The profit is around 18%, not bad for a short trade, this is a test of whether my theory correlate to the technical analysis I have been using.

Summary

I hope this article can inspire some who are looking at trading Gap Up stocks, there are times when a stock might go for 2 straight trading sessions of Gap Up, but normally the third one will be short-lived.

I still believe that it is important to follow our trading plan and also use technical indicators to help us.

Appreciate if you could share your thoughts in the comment section whether you think Cazoo could allow another Gap Up in pre-market when market open on next Monday (01 April 2024).

@TigerStars @Daily_Discussion @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.