Was your social media feed filled with memes last week? Especially memes about Jensen Huang and Microsoft.
Hundreds (if not thousands) of memes and parodies of both incidents flooded my social media accounts. Behind the humor and creativity, I feel for Jensen Huang and his family.
Although most of Microsoft’s services went dark on Friday, its share price wasn’t affected. Instead of falling greatly, its shares rose 0.17%! That’s remarkable, given that almost all medium and large enterprises were affected by the outage.
With most of its services back online, it’ll be a hectic week for many of us when we return to work.
Fret not, because I have you covered in the stock market.
Over the weekend, I’ve identified a stock that has been around for nearly 60 years. Its performance and behavior are excellent, providing the consistency needed in a volatile market.
But before I share my findings and analysis on this week’s #PowerStocks pick, let’s discover how our previous stock performed – Nasdaq (NDAQ).
Review Of Last Week’s Pick Of The Week
Nasdaq (NDAQ) was our previous #PowerStocks pick.
It’s a well-known company that provides trading, clearing, regulatory, and securities listing services, among others.
Despite being worth almost $60b in market capitalization, its shares have the ability to explode higher repeatedly.
After rising 16.1% in less than 2 weeks, I was anticipating a pullback to show up soon.
However, its shares continued rising for a week before the pullback came.
Am I still interested in buying its shares for an explosive swing trade?
Head over to my Telegram Channel to find out!
Speaking of Telegram, my team and I will never ask you for your hard-earned money for “investments”.
I know and understand that the allure of high returns without effort is highly attractive. It breaks my heart when I hear of people falling for impersonation scams.
To protect you from scams, please note that my team and I WILL NEVER solicit for any investment.
A list of our official communication channels can be found here.
Why Is Swing Trading Fastenal (FAST) Worth It?
Source: fastenal.com
Fastenal operates hardware stores and distributes tools that are used in data centers, manufacturing, and even power generation.
With its size of operations, Fastenal enjoys an enviable market capitalization of over $63b.
While the shares of many large companies are lethargic, Fasternal’s aren’t.
Its share price is capable of bursting upwards repeatedly, between 4.2% and 14.2%, 29 times in just the past 11 months!
After rising by 8.3% in a week, a pullback is finally here.
Could this be a fantastic opportunity to buy its shares and ride its next big upmove?
What’s my game plan?
Continue reading to get the details.
Performance Of US Stock Market vs Fastenal (FAST)
What is the 1st thing I’d want to know from this analysis?
I want to identify the trend of Fastenal’s share price.
Why?
Knowing the trend of its shares allows me to determine whether I’d look for a buying or shorting opportunity because following its price trend will sharply increase my chances of profitability.
Given the mighty uptrend in Fastenal’s share price since Sep, I’d like to identify a buying opportunity.
Great! But that’s not all.
I’ll compare the performance of the S&P 500 (black) against Fastenal’s shares (blue).
A stronger performer is more likely to continue bringing a higher return; therefore, buying the stronger performer is more likely to make my hard-earned money work harder.
While the S&P 500 had climbed 2.8% in the past 3 months, the shares of Fastenal shot up by more than 8.1% in the same time period! That’s an extraordinary outperformance of almost 3x!
I want to buy its shares for an explosive swing trade.
But is this all there is to analyze?
How Explosive Is Fastenal (FAST)?
No, there’s still more to analyze to boost my chances of success.
Because I only wish to ride its next powerful upmove instead of holding on to its shares, my holding period will be as short as a few days. Hence, I want its shares to have the ability to explode upwards fast.
Have the shares of Fastenal been exploding upwards consistently?
Marking out the explosive upmoves for the past 11 months has left me stunned.
There are 29 explosive upmoves, and each of them measures between 4.2% and 14.2%!
What’s even more impressive?
Fastenal is 1 of the largest tool distributors with a massive market capitalization of over $63b.
The share movement of such huge companies is usually more subdued, but not Fastenal’s.
Additionally, I appreciate that Fastenal enjoys an enormous market capitalization, as this provides an extra layer of security against manipulation. I don’t wish to lose my hard-earned money to manipulation that could be easily prevented!
Here comes the golden question: Is it time to buy the shares of Fastenal for an explosive swing trade?
Key Price Levels
As with many things in life, timing is key. Trading is no exception.
Buying an explosive stock at the wrong time can result in significant losses and emotional distress. This will cause you to lose confidence, and you’ll doubt yourself even when a fantastic trading opportunity arises right under your nose!
Is it time to buy the shares of Fastenal for an explosive swing trade?
You can gain this insight by uncovering its key price levels (also known as support and resistance zones). And that’s what I’ve done in the chart above.
I’ve marked out a strong support area around $54.
Because its shares have soared over 8% in 1 week, I think that its shares could continue to pull back.
Once this happens, I’ll be on the lookout for a bounce off $54 before buying its shares to catch its next explosive upmove.
Here’s a pro tip: Instead of staring at your screen, consider setting a price alert on your broker’s platform to be notified so that you can spend precious time with your loved ones.
Which Instrument Should You Consider Using?
Do you ever wonder about the instrument used to trade explosive stocks?
With 3 main trading instruments available – stocks, contract-for-difference (CFD), and options, you wonder which suits you best.
Since stocks (as an instrument) is easy to understand, I shall focus on CFD and options.
Here are the main similarities and differences:
CFD works like a mirror to stocks. When a stock rises $1, its CFD rises $1.
However, due to its unique pricing mechanism, your options price doesn’t rise by the same amount. In fact, depending on the market conditions, the price of your options contract may even drop!
Your CFD broker will charge you a finance fee for lending you money for your trade. However, no lending is required for options, so there is no finance charge.
Because there’s a finance charge by your CFD broker, CFD is not the ideal instrument for mid to long-term trades. On the other hand, options allow you to implement different strategies across time horizons.
Both CFDs and options are leveraged instruments because they allow you to control a larger market position with a smaller amount of capital.
While CFDs do not have an expiration date, options traders must pay attention to the expiration date of their options contracts.
You must be thinking, “What’s the beauty of trading options?”
Options are like smartphones. You can choose to use a smartphone for its basic or advanced functions.
And options don’t have to be all about Math and dry!
It can be made easy to understand through real-life analogies.
In the same way, you can implement basic and/or highly advanced strategies depending on your level of comfort.
Options allow you to be versatile in adapting to the shifting market conditions and capturing opportunities in the process.
Are you a CFD or options trader?
I’m glad to be fluent in both.
Finally, this is for educational purposes. Please perform your due diligence.
All images are taken from pexels.com, pixabay.com, sectorspdrs.com, tradingview.com, and unsplash.com, unless otherwise mentioned.
Want To Learn How I Find Stocks Like Fastenal?
Fastenal is just one example.
Opportunities like this appear in the market all the time.
The difficult part isn’t knowing they exist.
It’s knowing how to spot them.
And after spotting them, knowing –
→ When does an entry actually make sense?
→ When is good to exit and take profit…
→ And when should you simply stay away?
Without a system, it’s easy to jump between stock tips, news, indicators, and opinions.
You don’t know what you should look out for…
And every trade feels like a gamble. A risk.
So if you haven’t attended my FREE Online Preview before – join the next one.
Not only will I show you how to find opportunities like Fastenal…
I’ll also walk you through how I use a repeatable system to know when to enter and exit – instead of relying on random tips or guesses
Click the banner below to reserve your seat for the upcoming free session.
