April 29

Swing Trading Opportunity: Builders FirstSource, Inc (May 2023)

The US market moved fiercely down and up in the past week.

Last week Fortinet (FTNT) continued down without presenting a setup.

I’d rather have this than getting whipsawed out of the stock because of the fierce up and down move.

This week we are looking at a company’s stock that has been on an upward trend since the beginning of the year.

What is the name of this company? Read on!

Builders FirstSource, Inc (BLDR) is a manufacturer and supplier of building materials and services in the United States, and there is a potential swing trading opportunity for traders looking to capitalize on this trend.

BLDR’s stock has been rising year-to-date.

It’s currently trading at around $95.

Performance Of US Stock Market vs Builders FirstSource, Inc (BLDR)

Look at how much BLDR has outperformed S&P500 since the start of this year.

Even when S&P 500 was negative, BLDR remains positive!

In addition, BLDR pulled back and rebounded.

How Explosive Is Builders FirstSource, Inc (BLDR)?

When utilizing the swing trading strategy, swing traders are anticipating short term movements in their favor.

Since the start of this year, BLDR has been moving up on a double-digit percentage and what would the coming week look like if we were to plan for this trade?

Key Price Levels

The channel serves as a key support level.

This gives us an indication that swing traders probably took or are planning to enter around the key levels of 93 – 95.

As swing traders, if we were to take a conservative 10% up move, 100 bucks seem achievable.

If price were to fall out of the channel, hitting 85 – 87.5, then it proves that our thesis for a swing trade is wrong and we get stopped out.

Now it all comes down to whether Mr. Market gives us a window of opportunity to enter at a price where risk to reward makes sense.

The Strategy You Can Use To Swing Trade Builders FirstSource, Inc (BLDR)

Having compared the performance of BLDR and S&P500, understanding how BLDR is doing technically and BLDR’s key levels, how should we approach and find more stocks of such nature?

To be an effective swing trader, you must know your entry, profit target, stop loss levels.

By actively managing our trades, we expect to get better returns and that can only be done with a well thought out plan.

Plan your trade and trade your plan.

If you fail to plan, you plan to fail.

Using The Art of Explosive Profits (AEP) framework, I’d like to see BLDR stay within 93 – 95 before considering a trade.

As the name implies, you’ll be looking to consistently catch an explosive move in a short period of time.

Instead of relying on news and hearsay, the AEP course will teach you how to screen stocks for swing trading like BLDR.

You’ll also learn how to read charts and identify stocks that are about to make a big move.

Finally, you’ll learn how to identify the optimal entry, stop loss, and take profit levels to capitalize on these explosive moves (in a safe manner, of course)!

Can you apply the AEP framework to provide you with a side income while working full time? 

Yes, you can! 

Come, have a look at the AEP framework and incorporate this explosive trading strategy to your arsenal to capitalize on more swing trading opportunities.

Why Is Swing Trading BLDR Worth It?

Source: bldr.com

Builders’ FirstSource shares have been beating the market in the past 3 months.

Each explosive up move is at least a double figure percentage move.

While we wait for a reasonable price that gives us a good risk to reward, please keep in mind that I’m not a financial advisor, so please treat this as edutainment and conduct your own research.

Lastly, all images are from sectorspdrs.com, tradingview.com, and unsplash.com.

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Trade safe!


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