{"id":4698,"date":"2016-09-28T13:01:52","date_gmt":"2016-09-28T17:01:52","guid":{"rendered":"http:\/\/www.morpheustrading.com\/blog\/?p=4698"},"modified":"2016-09-28T13:35:11","modified_gmt":"2016-09-28T17:35:11","slug":"lmat-swing-trade-review","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/","title":{"rendered":"Swing Trade Walk-Through: $LMAT From Entry To Exit For +15.7% Gain"},"content":{"rendered":"<p><a href=\"https:\/\/www.lemaitre.com\/\" target=\"_blank\" rel=\"nofollow noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-full wp-image-4703\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/LeMaitre-Vascular-Inc.jpg\" alt=\"$LMAT stock trade\" width=\"275\" height=\"183\" title=\"\"><\/a>On September 22, we closed\u00a0our winning\u00a0trade\u00a0in Lemaitre Vascular ($LMAT) for a price gain of +15.7% in our model portfolio.<\/p>\n<p>Not bad for a swing stock trade&#8230;but enough about that.<\/p>\n<p>Let&#8217;s get right to the\u00a0technical\u00a0walk-through of\u00a0that profitable breakout trade, from the exact\u00a0entry to exit.<\/p>\n<p>Grab\u00a0your notebook and pen because this post is light on the hype and heavy on the trader education. Enjoy&#8230;<\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">TABLE OF CONTENTS<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/#Gap_Go\" >Gap &amp;\u00a0Go!<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/#Healthy_Consolidation\" >Healthy Consolidation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/#The_Buy_Entry\" >The Buy Entry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/#The_Follow-Through\" >The Follow-Through<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/morpheustrading.com\/blog\/lmat-swing-trade-review\/#The_Exit_157_gain\" >The Exit (+15.7% gain)<\/a><\/li><\/ul><\/nav><\/div>\n<h3><span class=\"ez-toc-section\" id=\"Gap_Go\"><\/span><strong>Gap &amp;\u00a0Go!<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>$LMAT first caught our attention as a potential swing trade on July 28, when the stock opened about 10% higher (&#8220;gapped up&#8221;) in reaction to earnings.<\/p>\n<p>Since the gap occurred on volume that was three times greater than average, it was a clear buy signal for momentum trade entry.<\/p>\n<p>However, after three days in a row of big gains,\u00a0the price action became too extended in the short-term to provide a positive risk-reward ratio.<\/p>\n<p>As such, we needed to wait for a low-risk entry point to develop:<\/p>\n<figure style=\"width: 912px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT1.png\" target=\"_blank\" rel=\"nofollow\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT1.png\" alt=\"$LMAT DAILY\" width=\"912\" height=\"762\" title=\"\"><\/a><figcaption class=\"wp-caption-text\">$LMAT gap up (click to enlarge chart)<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"Healthy_Consolidation\"><\/span><strong>Healthy Consolidation<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The parabolic, three-day rally was followed by three weeks of bullish, sideways price\u00a0<a href=\"https:\/\/www.morpheustrading.com\/blog\/best-stock-breakouts\/#base\" target=\"_blank\">consolidation<\/a>.<\/p>\n<p>Sideways price action is also known as a &#8220;correction by time,&#8221; so\u00a0we patiently waited on the sidelines for the ideal time to buy.<\/p>\n<p>Our opportunity came when $LMAT formed a bullish <a href=\"https:\/\/en.wikipedia.org\/wiki\/Hammer_(candlestick_pattern)\" target=\"_blank\" rel=\"noopener\">hammer<\/a>\u00a0candlestick by undercutting the low of its range, then rallying to close\u00a0near its intraday high\u00a0on August 19.<\/p>\n<p>It&#8217;s a bullish signal\u00a0when\u00a0the price of a stock dips below an obvious level of price support, but immediately snaps back above it.<\/p>\n<p>When nervous investors&#8217; stops get run, supply gets absorbed and it becomes\u00a0easier for the stock to breakout of its\u00a0base and resume its uptrend.<\/p>\n<p>The bullish reversal candlestick (hammer) that formed on August 19\u00a0is shown on the daily chart below:<\/p>\n<figure style=\"width: 912px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT2.png\" target=\"_blank\" rel=\"nofollow\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT2.png\" alt=\"$LMAT DAILY\" width=\"912\" height=\"762\" title=\"\"><\/a><figcaption class=\"wp-caption-text\">$LMAT consolidation (click to enlarge chart)<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"The_Buy_Entry\"><\/span><strong>The Buy Entry<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>After $LMAT formed that bullish reversal on August 19, we listed the stock in that evening&#8217;s <strong><a href=\"https:\/\/www.morpheustrading.com\/services\/swing-trade-alerts\" target=\"_blank\"><em>Wagner Daily<\/em><\/a>\u00a0<\/strong>watchlist for potential swing trade buy entry the next day.<\/p>\n<p>The buy trigger price was $17.51, just\u00a0above the high of the reversal bar.<\/p>\n<p>The protective stop price was listed as $16.69, right below the low of the bar (and the 20-day exponential moving average in this case).<\/p>\n<p>Here is the\u00a0actual commentary that accompanied our stock pick:<\/p>\n<blockquote><p>After clearing the prior swing high at $17 on heavy volume, $LMAT has chopped around in a tight range around the 10-day MA. We are looking for a break of the short-term downtrend line on a pick up in volume. The stop is placed below the 20-day EMA, minus some wiggle room.<\/p>\n<p>$LMAT is solid fundamentally, with three quarters in a row of accelerating, quarter over quarter EPS growth, and a 44% 3-5 year growth rate.<\/p><\/blockquote>\n<h3><span class=\"ez-toc-section\" id=\"The_Follow-Through\"><\/span><strong>The Follow-Through<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The buy entry triggered in the next session (August 22), but did not move out right away.<\/p>\n<p>Instead, the price\u00a0chopped around support of the 20-day EMA for a week, but\u00a0never actually closed below the moving average.<\/p>\n<p>After forming another hammer candlestick\u00a0on August 27, $LMAT finally rallied off the 20-day EMA on higher volume (August 29 &amp; 30):<\/p>\n<figure style=\"width: 912px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT3.png\" target=\"_blank\" rel=\"nofollow\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160927LMAT3.png\" alt=\"$LMAT DAILY\" width=\"912\" height=\"762\" title=\"\"><\/a><figcaption class=\"wp-caption-text\">$LMAT follow-through (click to enlarge chart)<\/figcaption><\/figure>\n<p>On September 6, $LMAT had a monster follow-through breakout on massive volume that pointed to\u00a0institutional buying interest.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"The_Exit_157_gain\"><\/span><strong>The Exit (+15.7% gain)<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>After the surge of September 6, the stock was up about 18% from the August 22 buy entry in our model newsletter portfolio.<\/p>\n<p>If you&#8217;re a trader who prefers relatively quick swing trades to catch a 10-20% gain, selling into strength at that time would have been ideal.<\/p>\n<p>However, we were looking to hold $LMAT for a bigger gain,<em> provided that the price and volume patterns remained bullish.<\/em><\/p>\n<p>On September 19, $LMAT again broke out on a pick up in volume, but closed well off its intraday high\u00a0and near the mid-point of the day&#8217;s range.<\/p>\n<p>The following day, $LMAT stalled above $22, and on higher volume that hinted at stealth institutional selling into strength.<\/p>\n<p>With $LMAT struggling to get above $22, we decided\u00a0to\u00a0tighten our stop to $20.35, just beneath the September 16 low.<\/p>\n<p>The idea of raising the stop was to still lock in a gain of about 15% if the breakout failed.<\/p>\n<p>As shown on the final chart below, $LMAT rolled over on September 22 (on sharply higher volume):<\/p>\n<figure style=\"width: 912px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/16097LMAT4.png\" target=\"_blank\" rel=\"nofollow\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/16097LMAT4.png\" alt=\"$LMAT DAILY\" width=\"912\" height=\"762\" title=\"\"><\/a><figcaption class=\"wp-caption-text\">$LMAT exit (click to enlarge chart)<\/figcaption><\/figure>\n<p>As shown above, we sold $LMAT for a final share price gain of +15.7% ($20.31 exit) on September 22.<\/p>\n<p><em>Got any questions about this swing trade walk-through? Just drop us a comment below. <\/em><\/p>\n<p><em>By the way, if you want to see this trade exactly as it appeared in our newsletter, <a href=\"https:\/\/www.morpheustrading.com\/the-wagner-daily\/\" target=\"_blank\">press here<\/a> to view our free swing trading archives.<\/em><\/p>\n<div class=\"cfmonitor\"><center><script src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\" async=\"\" type=\"text\/javascript\"><\/script><!-- Footer of content --> <ins class=\"adsbygoogle\" style=\"display: inline-block; width: 300px; height: 250px;\" data-ad-client=\"ca-pub-7565144363001883\" data-ad-slot=\"7002222565\"><\/ins><script type=\"text\/javascript\">\/\/ <![CDATA[ (adsbygoogle = window.adsbygoogle || []).push({}); \/\/ ]]><\/script><\/center><\/div>\n","protected":false},"excerpt":{"rendered":"<p>We recently sold $LMAT for a gain of +15.7% on a one-month holding period. Here&#8217;s a technical walk-through of the trade from entry to exit.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[3],"tags":[],"class_list":["post-4698","post","type-post","status-publish","format-standard","hentry","category-stock-trading-strategy"],"_links":{"self":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/4698","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/comments?post=4698"}],"version-history":[{"count":0,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/4698\/revisions"}],"wp:attachment":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media?parent=4698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/categories?post=4698"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/tags?post=4698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}