Top Trade Ideas for the Week of August 26, 2013: Bonus Idea

• Posted by Greg Harmon
• on August 26th, 2013

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

Astra Zeneca, Ticker: $AZN

Astra Zeneca, $AZN, has been a much better looking stock on a weekly basis than in the daily chart with a strong trend higher since June 2012. The current move higher is starting to break above consolidation at 50 and has support for a continuation higher from the rising and bullish Relative Strength Index (RSI) and a Moving Average Convergence Divergence indicator (MACD) that is about to cross positive. The Measured Move higher takes it to 55 and symmetry would suggest that this will take until the end of September or early October. There is resistance higher at 52.50 and then some air. Support lower is found at 50 and 46-46.50 followed by 45.

Trade Idea 1: Buy the Stock now with a stop at 49.50.

Trade Idea 2: Buy the October 50 Calls (offered at $1.65 late Friday).

Trade Idea 3: Buy the September/October 52.50 Call Calendar (40 cents).

Trade Idea 4: Buy the September/October 52.50 Call Calendar selling the October 47.50 Put (15 cents).

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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 unofficial last week of Summer looks for Gold to continue higher while Crude Oil rises in the consolidation zone. The US Dollar Index seems to have found a bottom and should bounce while US Treasuries are bouncing but biased lower. The Shanghai Composite looks to drift lower and Emerging Markets are biased to the upside in the very short term. Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts see some upside with the QQQ strongest and IWM next and SPY still needing to prove the pullback is over. Use this information as you prepare for the coming week and trad’em well.

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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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