Hanes Looks Good All Under

HanesBrands, $HBI, reported earnings Tuesday after the market closed and moved higher in the market Wednesday. With that report aside it is no free from the risk associated with earnings movements and ready to look at for a trade. The chart below shows both the risk and opportunity prior to earnings. Running higher in an AB=CD Harmonic pattern with a Potential Reversal Zone (PRZ) from 48 to 50.50, it had a hardly a pullback since the year end lows. Now with the bull flag

hbi 48-51

lows at 37.00 as a stop area you can trade this for the move higher. But with another perspective, you might want to wait for a break over the rising wedge developing in the CD leg to try it long. The wedge pictured below can always resolve either to the upside or the downside. With price at the top of the wedge and support for a break higher from the rising and bullish Relative Strength

hbi

Index (RSI) and a Moving Average Convergence Divergence indicator (MACD) that is about to cross to positive, a break over the wedge gives a target to 46, near the PRZ. A fall back to the bottom near 37 coincides with the other chart and a break below 37 triggers a target lower at 30.

Join the Dragonfly Capital Views Premium Membership

Sign up here to get deeper analysis and nearly 50 trade ideas every week.

Dragonfly Capital Views Performance Through January 2013 Expiry

If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.

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.

blog comments powered by Disqus
Dragonfly Caps Blog