- Company: Five Below
- Stock Ticker: FIVE
- Bias: Bearish
Long trades haven’t worked out very well in the last couple of weeks, so let’s try a bearish one instead. FIVE is currently testing the 200-day simple moving average and is only around 30 cents from breaking the large gap produced back in June.
I would look to put a sell stop limit order slightly below the low of the past 2 previous trading session at around $94.42. This will put this trade right in front of all the stops that are sitting near the gap from June which I believe we’ll see accelerated movement once that has been broken. The protective stop on this trade would be around $105.40.
I’ve chosen a larger than normal stop, but I would look to target filling the gap at $81 which is slightly over a 1:1 risk to reward ratio. This should give the trade enough room to breath and let the charts play out.