Top Trade Ideas for the Week of February 4, 2013: Bonus Idea

• Posted by Greg Harmon
• on February 4th, 2013

Here is your Bonus Idea with links to the full Top Ten:

Amgen, Ticker: $AMGN

Amgen, $AMGN, is consolidating after a move higher off of the pull back to 82. A break of the flag higher gives a target on a Measured Move to 90. The Relative Strength Index (RSI) is stalling after rising to the mid line and a push higher supports more upside complementing the Moving Average Convergence Divergence indicator (MACD) that is positive and already support higher prices. Resistance comes at 87 and 90 followed by 90.81. Support lower is found at 85 and 83.75 and then 82 and 80.50.

Trade Idea 1: Buy the stock on a move over 87 with a stop at 86.

Trade Idea 2: Buy the February 87.5 Calls (offered at 91 cents late Friday) on a move over 87.

Trade Idea 3: Buy the February 87.5/90 Call Spread (60c cents) on a move over 87.

Trade Idea 4: Buy the February/March 90 Call Calendar (53 cents) on a move over 87.

Trade Idea 5: Sell the March 82.5/80 Put Spreads (48 cents) on a move over 87.

Trade idea 6: Buy the February/March 90 Call Calendar selling the March 82.5/80 Put Spreads (5 cents) on a move over 87.

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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Saturday which heading into the first full week of February sees that the markets have their bull on. Gold looks to have stayed off a fall and will consolidate while Crude Oil continues higher. The US Dollar Index is moving lower again and US Treasuries are joining it to the downside. The Shanghai Composite is racing higher again after some consolidation and Emerging Markets are biased to the upside but consolidating. Volatility remains near historic lows and showing no signs of rising elevated keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. The weakening US Dollar and Treasuries support higher equity prices as well. And the charts of these ETF’s agree, with the QQQ looking to finally join the party higher. Use this information as you prepare for the coming week and trad’em well.

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Dragonfly Capital Views Performance Through January 2013 Expiry

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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