Top Trade Ideas for the Week of September 16, 2013: Bonus Idea

• Posted by Greg Harmon
• on September 16th, 2013

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

Discover Financial, Ticker: $DFS

Discover Financial, $DFS, is approaching resistance at 51.25, a point that has stalled it twice before. There is no resistance higher and support lower comes at 49 and 47 before 46.10 and 45. The RSI is rising and bullish and the MACD is rising, both supporting more upward price action. A break over the top of resistance carries a Measured Move to 55.50.

Trade Idea 1: Buy the stock on a move over 51.25 with a stop at 50.50.

Trade Idea 2: Buy the October 50 Calls (offered at $2.00 later Friday) on the same trigger.

Trade Idea 3: Buy the October 47/50 bullish Risk Reversal ($1.75).

Trade Idea 4: Buy the January 46/55 bullish Risk Reversal (15 cents).

Trade Idea 5: Buy the October/January 55 Call Calendar ($1.10).

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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 September Options Expiration sees the market looking stronger again. Look for Gold to continue lower, possibly resuming the downtrend while Crude Oil consolidated in the uptrend. The US Dollar Index looks to continue to the lower end of the broad range while US Treasuries are biased lower but may consolidate. The Shanghai Composite and Emerging Markets both may continue to consolidate in their uptrends with an upward bias. Volatility looks to remain low keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts look as if they may consolidate first with the QQQ looking the strongest of the three. Use this information as you prepare for the coming week and trad’em well.

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