Give me a "P". No, not for "Pat" Sajak, instead for "Profit" from this trade in about a week or so.
Yesterday the markets gave me an indication that we are going higher. The markets gapped up at the open and then most of them moved higher. So yesterday was a very bullish day. Today a pullback is expected, and that's exactly what is happening.
So, I looked for a good entry and found one in XRT. Check out this chart:
Today's entry is in green. If you first look at yesterday's candle you'll see that we had that nice pop, just like the markets - so this stock follows the market nicely.
You'll also notice a few things if you look close enough:
1. The MACD lines have been going steadily bullish
2. The stoch had a crossover
3. The 50 day moving average was broken to the upside yesterday and we're testing it today.
I like this entry because we are getting in at a low point, so there's more room to move before we hit our target, which is just before the next level of resistance around the $40.90 zone.
I got long Sept 36 Call for $2.83. Looking for this to be a week or two trade. We should get maybe another sideways day and then get a few good bullish days.
I'll solve the puzzle shortly Pat, and will take the prize, thanks.
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