On a Narrow Path

The theme of an increasingly selective market has been a recurring one on this blog over the past week or two. Five Below is a pretty good example of that, in the sense that we simply must keep a tight leash on any breakout plays at this stage in the rally. While the stock may not be ready to completely fall apart, instead regrouping to consolidate more, it clearly was not ready to break higher. In the process, many longs got trapped, particularly those who could not quickly cut losses and step aside.

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