Masonite International (DOOR) This one's from Mat
Post# of 2218
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Posted On: 05/10/2017 3:20:40 PM
Masonite International (DOOR)
This one's from Matt McCall, Hilary's partner on Breakout Stocks and, most recently, ETF Trend Trader. Like Hilary, Matt likes to focus on next-generation stocks, not the same group of names Wall Street gets stuck in. When thinking about NextGen stocks, though, he issure nobody would come up with a company that makes doors. Well, guess what? It's not only a major play in a long-term theme, it's also a trading opportunity right now.
Let's start with what the chart tells us. Masonite International (DOOR), one of the leading door makers in the country, has pulled back 7% from its all-time high over the last month and came down to key support at the 50-day moving average. At the same time, the Relative Strength Index (RSI), while not quite in oversold territory, is at the lowest level of the year. More importantly, it has started moving higher — a bullish signal.
Also important, the volume on the month-long pullback has been lower than the average volume during the rally that took the stock to a new all-time high.
A 2% move up on April 17 has the stock further above its 50-day average, but Matt still likes the reward-to-risk set-up here and would be a buyer, especially on pullbacks closer to the 50-day, currently around $76.30. If you like to use stop-losses in your trading, Matt would look to the $73.25 area, which is the prior all-time high from 2015 and is now considered support.
This one's from Matt McCall, Hilary's partner on Breakout Stocks and, most recently, ETF Trend Trader. Like Hilary, Matt likes to focus on next-generation stocks, not the same group of names Wall Street gets stuck in. When thinking about NextGen stocks, though, he issure nobody would come up with a company that makes doors. Well, guess what? It's not only a major play in a long-term theme, it's also a trading opportunity right now.
Let's start with what the chart tells us. Masonite International (DOOR), one of the leading door makers in the country, has pulled back 7% from its all-time high over the last month and came down to key support at the 50-day moving average. At the same time, the Relative Strength Index (RSI), while not quite in oversold territory, is at the lowest level of the year. More importantly, it has started moving higher — a bullish signal.
Also important, the volume on the month-long pullback has been lower than the average volume during the rally that took the stock to a new all-time high.
A 2% move up on April 17 has the stock further above its 50-day average, but Matt still likes the reward-to-risk set-up here and would be a buyer, especially on pullbacks closer to the 50-day, currently around $76.30. If you like to use stop-losses in your trading, Matt would look to the $73.25 area, which is the prior all-time high from 2015 and is now considered support.
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