Picture Perfect Profits Await in GoPro Inc (GPRO) Stock

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Beleagured GoPro Inc (NASDAQ:GPRO) shareholders received their first hint of salvation this month. Outside of January’s pop, GPRO stock has been a dog in desperate need of a positive catalyst all year long. That arrived on Aug. 3 in the form of a better-than-expected earnings announcement.

Not that the company made any money, mind you. It simply lost less than expected. For a stock as beaten down as GPRO, that counts as a win!

The ensuing rally carried the once promising action-camera developer higher by over 19%. Scorched shorts ran for cover helping to propel the stock back over the 200-day moving average. This marks the first time GoPro stock has been above the 200-day since last October.


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Source: OptionsAnalytix

But have buyers sallied forth to capitalize on this newfound uptrend? Sadly, no — not yet at least. Instead of believers buying into the strength, we’re seeing worn out shareholders departing in droves. Since peaking at $10.85 in the earnings aftermath, we’ve seen GPRO give back the bulk of its gains.

And now it’s testing the 200-day moving average. A break here would likely result in the full surrender of all the earnings-induced gains.

It’s put up or shut up time for GPRO stock bulls.

The GPRO Trade

If you’re eyeing GPRO for a trade here, the only choice is to bet with buyers. With the stock having dropped so far over the past two weeks, it’s too late to short.

Rather than piling in willy-nilly, let’s wait for confirmation that support has formed and a new upswing is kicking off. If GPRO breaks above Monday’s high ($9.12), then buy shares with a stop near $8.65.

If you’re an options trader, then consider selling the Sept $8.50 put. The margin requirement is minimal making the potential return on investment very attractive.

As of this writing, Tyler Craig did not hold a position in any of the aforementioned securities. Want to learn how to master the art of option selling for high-probability cash flow? Check out Tyler’s recently released video series through Tackle Trading on how to systematically sell iron condors for monthly income.

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Article printed from InvestorPlace Media, https://investorplace.com/2017/08/picture-perfect-profits-await-in-gopro-inc-gpro/.

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