We have had a line in for this potential breakout and we are seeing some nibbles.
As more and more speculation spreads that there is some type of bottom forming the opportunities to pick up some great bargains are popping up.
A couple weeks ago we threw a stock on our radar to watch (check it out here) and a key indicator just gave us a hint that it could be moving soon. Let’s look at the chart and a couple examples of how to exploit this set up.
Ford has definitely been beat down hard with the rest of the market but has been showing positive signs that it may lead the big auto in breaking out. It’s Q2 numbers out paced the trend and it’s top EV models have been getting a lot of press.
When we look at the chart we can see it is starting to find support just above 10 and has shifted from a complete downtrend to more of a sideways consolidation. In addition, even though it is hard to see on the chart above, the MACD is signaling a shift in momentum with room to run.
Picking this up at 11 and change isn’t a bad idea. It has the potential to jump to recent highs at 13 and just above 15. A 30-50% grab isn’t bad at all in this market. But you could also consider a September 16th 15 call. They are at .11 right now and even a little move up could push that higher quickly.
We are going to continue to keep an eye on this one and we’ll follow up in the coming weeks to see how it plays out.
Chris Verheagh has put together a incredibly effective formula for great options trades. The best part of it is that is uses math and takes emotion out of the equation. Be sure to check it out here.
Keep learning and trade wisely,
John Boyer
Editor
Market Wealth Daily
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