I wanted to show how pivot stops were used in the ZOLT - Zoltec Companies trade before leaving today. I’m going out of town, and won’t be trading Friday or Monday.

In my last post I had sold 1/2 of the ZOLT trade at 2R, and left the rest at pivot stops. My plan was to leave the trade on until the end of the day. This would take any emotion out of the trade. I would let the market determine my exit.

I’ve signified each pivot point on the Zoltec 5-minute chart. After my first exit, I could do one of two things; raise my stop to breakeven, or leave the original stop. My risk was less than a dime, so I left it. Generally, it’s better to leave the first stop, and wait for the stock to pivot (point 1).

You then wait for the stock to rise above the current day high, which was point 2. You don’t raise your stop yet. Wait for it to pivot first (point 3). Now if your plan incorporated selling partial amounts at set targets, you would sell some. My plan for this trade did not. I always follow my plan.

Ok, so wait for the downside pivot (point 4). You still leave your stop in place. When the stock breaks the next current high (point 5), the stop is then raised to point 4.

I’ll incorporate targets for selling in 1/3’s quite often, but since I have not been letting winners ride lately, I wanted to let this trade fully play out.

Keep an eye on the gold sector. It’s forming a bottoming base. Enjoy the weekend.

We’ve got a breakout in Zoltek Companies Inc - ZOLT this morning on the daily. The move up has been in a trend for the past five days, so we’ll see if it holds.

The stock provided an entry on the 5-minute chart. The 6th candlestick is the trigger bar over it’s high of 26.89. A stop is placed under the bar’s low at 26.81.

An alternative stop could be placed under the day low, which would be more conservative. 1/2 the shares are sold to lock in 2R, with a break even stop now. We’ll see what Zoltek’s stock does next. The plan is to use pivots as stop loss points for a hold until day’s end. This is a day trade.