Social media platform Pinterest ($PINS) is setting up extremely well after a very impressive move earlier this year. Pinterest first came across my radar in the summer as it formed a huge primary IPO base (see post here). Now, it looks to be forming a high tight flag pattern. After quickly doubling from approximately $35 to $70, it corrected around 25% the following week. It has been incredibly tight the past three weeks which is something I always like to see. In addition, it has held its 20-day moving average since late September. This is remarkable considering the large gain in Pinterest and the volatility the market saw around the United States Presidential election. I opened a pilot position in PINS today. I will look to add to my position if it can blast out to new highs with conviction. A stop loss below the 20-day moving average seems to make sense to me considering Pinterest's inclination to hold this key support level over the last two months. I typically do not trade high tight flag patterns as often as I trade other formations, however, this is an extremely hot market and a true market leader like Pinterest can really get going if it completes a flag pattern.
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Full Disclosure: I currently own shares of Pinterest.
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