CHOP is just about the most perfect setup I have ever seen. Here is a list of what's right about CHOP:
1. Recently announced quarterly revenue/earnings growth above 25%/100%;
2. Broke out of a 2 month base on massive volume on earnings announcement;
3. Is pulling back in an orderly manner in step with FXI, on light volume and is now at a band of support ($7.50 - $7.25) just off all time highs (It has basically formed a cup with handle);
4. Has a Market Cap of about $250 Mil and currently floats less than 10 million shares;
5. Has little analyst coverage is still relatively unknown;
6. Has significant insider ownership;
7. Trades more than 200,000 shares on an average day and is optionable and;
8. Currently, we are still near the start of a new uptrend in the indexes.
There you have it. One of the best set-ups I have ever seen (based on my rules) since trading. I am going to close out my other positions and back the truck up on CHOP if it triggers tomorrow. However, I have been in this game too long now to know that even the most perfect setups fail!!!
So, just in case...just in case I am wrong, I will still be using a cut loss along with a predetermined max. loss to ensure I live to fight another day!!!
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