KSPI – High-Conviction Breakout with Strong Fundamentals

📈 Trade Setup
Symbol: KSPI (Kansas City Southern Pacific)
Timeframe: Daily
Strategy: Breakout + Fundamental Momentum
Entry: $96.82 (above consolidation high)
Stop Loss: $88.28 (8.8% risk, below SMA 50 & swing low)
Take Profit: $114.01 (+17.8% reward)
Risk/Reward: 1:2

🔥 Why KSPI?
1. Technical Strength:

Breakout from 3-week consolidation ($90-$96 range)

Volume Surge: 460K shares on breakout (20% above avg)

RSI(14): 66 (bullish but not overbought)

MACD: Bullish crossover above signal line

2. Fundamental Edge (Score: 9/10):

Undervalued: P/E 9.1 (sector avg 25) | P/B 0.009 (deep value)

Growth: Revenue +33% YoY | Net Income +24% YoY

Zero Debt: Debt/Equity = 0.016 (pristine balance sheet)

3. Catalysts:

Sector-leading profit margins (28%)

Institutional accumulation (13F filings show +15% ownership growth)

⚡ Trade Management
Position Size: 1-2% portfolio risk

Partial Profit: Scale out 50% at $107 (prior ATH)

Trailing Stop: Move SL to $96 after hitting $107

📊 Key Levels
Level Price Importance
Support 1 $92.50 20-day EMA
Support 2 $88.28 Stop Loss (SMA 50)
Resistance 1 $107.00 All-time high
Resistance 2 $114.01 Target (1:2 R/R)
⚠️ Risk Notes
Low Liquidity: Avg volume 320K → Slippage risk

Macro Sensitivity: Railroad sector tied to commodity prices

Overextension: RSI nearing 70 could prompt pullback

🎯 Why This Trade Works
Best-in-class fundamentals meet technical breakout

Asymmetric risk/reward (1:2 with clear invalidation)

Institutional tailwinds (smart money accumulating)

#KSPI #ValueInvesting #Breakout
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📌 Disclaimer:
Not financial advice. Conduct your own research. Past performance ≠ future results. KSPI is low-float – manage position size carefully. Fundamental score assumes sustained growth execution.

Discussion Points:

How do you trade low-float stocks differently?

Would you hold through earnings (next report: Aug 28)?