Trade Setup: BBD

I bought 200 shares of BBD, a Brazilian bank, at $23.31.

Setup: Breakout-Pullback. The stock pulled back to the breakout level and has a strong volume pattern. As a plus, Brazilian stocks have been on fire.

Risk: My initial target is the old high around $25. I will either take full or partial profits at this level. If I feel the stock is ready to breakout to another new high, I’ll keep a position. My stop is under the breakout level. This only gives me about a 1.5:1 reward to risk, but I feel the probability of the setup is strong.

Concerns: I entered at the top half of the stochastic indicator–the pullback did not reach overbought levels. If today is the start of a deeper market pullback, it may bring this stock down with it.


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