ALAB (long) - consideration for sell into strength
$Astera Labs, Inc.(ALAB)$ - consideration for sell into strength
I am not good at selling into strength, especially on my perceived leaders. However, since I am currently on margin (50%) and I am going away for a trip next week, I am going to implement some hard stops/ backstops on some of my partials to safeguard my hard earn gains.
So, when and how to do it?
One trick/ objective rule to sell into strength is by use of the ATR(14) extension from 50sma. In general, a 6x to 10xATR would start to call for caution.
Currently the ATH of ALAB is about 7.2xATR (ATH 237.82, 50sma = 12.19, 50sma = 150.47) from the 50sma (c.f. 6.6xATR on the previous peak on 8/13).
I can proactively sell some, but knowing me, it is always hard for me to be the first to say good bye when things are going well. So, my way of selling into strength is a bit passive - I would start by setting a hard backstop on the prior day's low, which in this case is $228.51. If it doesn't get triggered, it would then be lifted as necessary as the price keeps advancing.
The partial I am eyeing to sell is 30% of my existing ALAB. If it triggered by backstop but continue to reverse back to the upside, I still have my 70% to cover for the upside! And of course, I can scoop this 30% back anytime later, preferably lower at some support.
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