Flows and fundamentals weak The stock lost 75bn yesterday on disappointing sales guidance Fundamentals (growth slowdown) and market flows (-40% in 12w) remain questionable
Technicals compelling The stock currently looks oversold on most time frames It closed yesterday at $142.19, resting on strong resistance at $140: - SMA 50 on the monthly chart (140.33) - SMA 200 on the weekly chart (141.82) - 62% Fib retracement from top of uptrend initiated in July 2016
Fast trade with tight stops Started buying the dips yesterday betting on rebound This trade requires caution as the consolidation may not be over Technicals have not turned yet and a visible “Death Cross” is still at play
Strategy Buy at $145 Stop-loss = 140 Target = 147 then 160 RR = 3 at the higher target
Nice analysis- but buying at 145 is a little premature imo- safer bet at >146
HAL9000
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@OmarHalawi, Thanks - Yes it would make sense to buy once we break the previous high on the daily chart. However, with a firm stop-loss at 140: 1/ if you end up being right, you will earn less and 2/ if you end up being wrong, you will lose more. Another alternative would be to start with half position here and to scale your trade. ;-)