Paypal Breaks Out From A 13 Week Base

PYPL chart

Paypal's breakout looked strong today. It finished the day at 98% of it's 30 day volume average and rose just over 3%. The volume seemed to be trending higher than 98% earlier in the day but it started to trail off. I was a little dissapointed in that but the trade still looks promising.

Let's start off at #1 on the chart, the point where I think the recovery began. Just before that price surge earnings pulled the PYPL down, but the institutions immediately came in and pushed the price right back up, missing a shakeout by just a few dollars. That's a good sign of stregth.

Trapped buyers came in pretty quickly and started to sell off their shares, pushing the price back down but not to as low as the previous low. #1 eliminated a lot of overhead supply. Now the fun begins because a few trading sessions later the institutions came back (#2) and started to push the price back up on fairly strong volume. There was little resitance because most of the weak holders had been washed out at #1.

That brings us to #3, falling volume with quickly consolidating price. #4 turned out to be the pivot point I was waiting for, and the next day brings us to today's breakout. I waited for the breakout to buy and bought when the price went 1% over the all time high. I wanted to minimize the risk of a head fake.

I have no specific plan for selling. It will either hit my stop loss or I'll sell when the chart starts to make me think it's a good time to sell.

Updated Dec 14, 2020 by Scott
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Paypal's breakout looked strong today. It finished the day at 98% of it's 30 day volume average and rose just over 3%. The volume seemed to be trending higher than 98% earlier in the day but it started to trail off. I was a little dissapointed in that but the trade still looks promising.

Updated Dec 14, 2020 by Scott