Fig 2 Monthly Chart of Square (SQ) June 2017
I devoted painstaking hours to analyzing the charts of over 2,700 stocks that went IPO from the years 2000 to 2016. And Square (SQ) is displaying that exact same pattern that took stocks like Facebook (FB), Amazon (AMZN), Netflix (NFLX), Tesla (TSLA) to become the great companies we all know them to be today.
I've been told that trading IPO stocks are risky. One person put it to me this way when I invited people to the very first workshop where I was going to reveal my discovery; he said to me "Thanks but no thanks on the IPO program. I feel there's enough risk on seasoned stocks."
Looking at the chart of SQ above, this doesn't seem like a stock that was risky. Plus the good news is that there's more room for the shares of Square (SQ) to more than double in price. Find out why when you watch part 1 of my "Secret To IPO Stocks That Double In Price Part 1"
For starters, I can understand why some traders see IPO stocks as risky. The vast majority of IPO stocks end up becoming losers than winners. But here's where my chart analysis began to pay off. First what I did was instead of looking at these stocks from a day trading point of view, I switched to the monthly chart and approached it from an investor or investment point of view.
What this did was it allowed me to see a bigger pattern that is oblivious to those who focus on daily chart patterns. After all, there is so much volatility up and down during the day, but once you switch to a monthly time frame, things begin to slow down and a bigger and much clearer pattern begins to emerge.
This one switch alone, made me discover one of the biggest mistakes traders make when looking at IPOs. And that is you gotta let the stock settle down first from all it's excitement. But alas, that is probably the hardest thing for most traders because when a stock first becomes public, that's when it gets so much attention from the media.