Top Trade Ideas for the Week of February 6, 2012: Bonus Idea

• Posted by Greg Harmon
• on February 6th, 2012

Bonus Idea with links to the full Top Ten:

W.W. Grainger, Ticker: $GWW
Here is your

W.W. Grainger, $GWW, is in a long bullish trend higher since the August bottom. After touching 205 it has recently pulled back to 190 and is not launching higher. As it retests 205 it has a bullish and rising Relative Strength Index (RSI) and a Moving Average Convergence Divergence (MACD) indicator that is swiftly moving back towards the zero line and a positive cross. A move over 205 has a Measured Move to 211 but no resistance higher. There is support below 190 at 184 and 181 followed by 177.70, 173.20 and 169. Notice that the upper Bollinger band is also opening as it moves higher.

Trade Idea 1: Buy the Stock on a move over 205 with a $5 trailing stop.

Trade Idea 2: Buy the February 210 Calls for 60 cents now.

Trade Idea 3: Sell the February 195 Puts on a stock move over 205.

Trade Idea 4: Buy the March 190/210 bullish Risk Reversal on a move over 205.

The Best

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The Rest

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After reviewing over 900 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 next week Gold appears ready for at least a short pullback while Crude Oil continues lower in it range. The US Dollar Index and US Treasuries seems content to move sideways while each is now biased lower. The Shanghai Composite and Emerging Markets are both better to the upside in the short run with Emerging Market looking higher long term as well while China remains in the downtrend. Volatility looks to continue lower although it may stop falling soon as it nears 4 year support levels. These influencers combine to create an environment for the Equity Index ETF’s SPY, IWM and QQQ, to continue higher. Their weekly charts agree but their daily charts all are starting to show signed they may be short term extended. Use this information as you prepare for the coming week and trade’m well.

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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