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October 2, 2007

Benefits of Using a Buy Stop On MSTR

Filed under: Online Stock Trading — Online Stock Trading @ 6:25 am

Yesterday’s rally took my QID long out early for a .25 loss. A stock I flagged last week as a new one to watch again was MSTR - MicroStrategy, Inc.

This stock traded into one of my favorite setups. On Thursday, MSTR shot off of the 50 day moving average with a high of 79.71. Friday, it traded in a very tight range. The high was 79.99, with hardly any pullback.

The setup was in place. A buy stop is entered at 80. The narrow range bar’s low acts as a stop loss point.

I’ll place buy stops frequently on setups I like. I usually set an alarm just before the trigger point, so I’m informed of the move. Buy stops save precious time when a stock is moving fast. I was taking another trade at the same time, and would have missed the entry in MSTR without the buy stop in place.

mstr-1001071.jpg

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