Ctrip.com (CTRP)

There are two dominant liquid Chinese leadership stocks in the current rally. One is BIDU. This other is online travel website Ctrip (CTRP).

In continuing market rally we feel CTRP is only higher. YOY sales and earnings have accelerated for three quarters in a row, with strong projections for at least the next two quarters.

CTRP is a hard stock to buy and hold. It is whippy and has a tendency of correcting violently. But the uptrend is clear and so is the correct way to enter this stock: when no one appears to want it.

Tuesday, in the midst of a robust holiday rally, CTRP broke down on some volume and bounced off its 10 MA weekly. This is often an ideal place to initiate a position. The stock finished off its lows of the session and yesterday took out the highs, indicating price is likely to recover and attempt new highs.

We are entering a long at the market this morning, around $73.50. Our stop will be Wednesday’s low of $70.55. Our goal, as always, is entry for a resumed uptrend in the stock.