PPR - ONVO 12/26/13

Published : December 26 2013 at 11:09 ET

After a sharp correction, ONVO gained traction at its 50dma, and will have a pocket pivot if it can trade at least 2,752,800 shares. Since ONVO is highly volatile, one may wish to use a slightly undercut of the 50dma as their sell stop which would be roughly 8.58, or -4.3% from where it's currently trading. Keep in mind that the pocket pivot may be premature as the base may not yet have fully formed as past bases for ONVO evidently show the stock needs time to heal after sharp corrections. The current base had such a sharp correction off its peak. On the other hand, since this is a seasonally strong time of the year for stocks, the odds of the pocket pivot working are greater, perhaps for a swing (3-5 day) trade.

This example serves as one of the thought processes that may go through your mind when sizing up a stock which may then determine your position size and sell stops. 

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