Top Trade Ideas for the Week of August 4, 2014: Bonus Idea

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

Netflix, Ticker: $NFLX
nflx

Netflix, $NFLX, has pulled back from a top at 475, creating a potential Cup and Handle formation. The target higher would take it to 650. The RSI has leveled after pulling back, while holding in the bullish zone with a MACD that is leveling and about to cross positive. A move over 437.50 would solidify the pattern and under 415 negates it for now.

Trade Idea 1: Buy the stock now or on a move over 437.50 with a stop at 420.

Trade Idea 2: Buy the August 430/440 Call Spreads (offered at $3.85 late Friday).

Trade Idea 3: Buy the August 430/400 1×2 call Spreads (25 cent credit).

Trade Idea 4: Buy the August/September 440 Call Calendar ($9.35) and sell the August 22 Expiry/September 385 Put Calendar ($3.05 credit).

Trade Idea 5: Buy the October 385/430 bullish Risk Reversal ($13.70) and sell the August 440 Calls ($4.05). As the August Calls Expire sell upside September Calls.

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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 Friday which, heading into the dog days of August sees the equity markets as mixed but with some weakness. Elsewhere look for Gold to continue lower in its band around 1300 while Crude Oil heads lower, unless the Hammer confirms Monday. The US Dollar Index looks to continue to eh upside but may consolidate first while US Treasuries are biased higher. The Shanghai Composite and Emerging Markets are both biased to the upside with the risk of Emerging Markets consolidating or pulling back first. Volatility looks to remain in the low range but biased to the upside keeping the bias neutral to higher for the equity index ETF’s SPY, IWM and QQQ. The indexes themselves continue to be mixed with the IWM still the weakest and falling, while the SPY also looks better to the downside in the short run, and the QQQ the strongest but still with a possibility of more downside. Use this information as you prepare for the coming week and trad’em well.

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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.

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