Tomorrow's trading plan

Good morning market enthusiasts. We're excited to be back in the market tomorrow, and here's the current plan which is subject to substantial revisions between now and tomorrow morning. Would like to go long ELGX (2.51), GSKY (18.25), and ARLO (20.65). 
These are different types of trades as we'll explain.

GSKY and ARLO are IPO's within the last six months. These types of stocks have not traded long enough to have established a lot of support or resistance. This is why recent IPO stocks can move up so fast and in such huge percentages. These stocks can also move down quickly and in huge percentages for the same reasons, lack of support. 

In order to trade these stocks effectively, you must have an accurate assessment of what the company is actually worth, where it will settle in the coming months. Having studied recent IPO's for many years, we trade these stocks differently: GSKY and ARLO will both be purchases in smaller portions allowing for the possibility of a dramatic sell-off. We want to be long these stocks, this is why we don't place stops. We will average down if the stock retreats 25%, and again if it hits -40% from our original purchase.  These average downs are with the same amount of capital, thus the stock is no more tired to the original purchase than it is the later purchases. Holding periods for these trades can encompass many months.

ELGX will have a stop @ 2.42, or we'll reconsider entry if the stock retreats below support which is just above our stop. Because ELGX has such a large resistance gap, our target, yet to be determined and always subject to revision, could vary widely depending on our profit whims. 

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