Today I want to share 2 trading setups that I have my eye on.
The stocks are Twitter (NYSE:TWTR) and Michael Kors (KORS). Charts and commentary are below.
The company needs no introduction as most of the fintwit people thrive on this platform. The company has a market cap of $34 billion.
The company reports earnings on July 25thbefore market open and the short float for the stock is 6.17%. January 2019 – 70 calls were bought today (June 26th) although there has been constant buying in this name.
After the recent run to make a 52 week high, the stock has been consolidating on lower volume to let the short term moving averages catch up with price. Stock is holding both its 8 EMA and 10 EMA on the daily timeframe and has formed a bull flag. Inside Day printed today (June 26th). Trigger over Monday’s highs of 45.52 with a stop at either 43.33 if one wants a tighter risk or room to 21 SMA near 41.77. Targets are 50.55 and 55.01. Always take profits near targets. July 45 calls or August 50 calls are attractive although a spread will be more risk defined (45/55 call spread).
Note: The author has a position in TWTR at the time of publication. Any opinions expressed herein are solely those of the author for educational purposes only and do not in any way represent the views or opinions of any other person or entity.
Michael Kors (KORS):
Michael Kors is a luxury apparel and accessories manufacturing company headquartered at London, United Kingdom with a market cap of $10 billion. The company’s Annual ROE is 38.8% and last quarter’s percentage change in sales was 11%. Company’s next earnings is on 8/29/2018 before market open and the short float is 3.27%.
The stock has been consolidating sideways on much lower volume and has held relatively well compared to what the indices have been doing. Range break awaits over 68.58 on daily timeframe. Risk is at 65.20. Target 1 at 71.38, Target 2 at 75.20. July 68 or 69 calls look decent or August 68 calls.
On the monthly timeframe, the stock has formed a bull flag and has held extremely well during the chop in June. It is above all moving averages on this timeframe. Traders can get involved this name on this timeframe on a break out over 70 with a stop under either 10 EMA which currently is at 59.55 or the monthly lows of 57.10. This is a long term swing with first target at 77.97 and additional targets at 84.58 and 90.87. A bullish risk reversal will be an ideal play (short August 60 or 57.5 puts and long 70/80 call spread or just 70/80 call spread if margin is not available).
Note: The author has no position in KORS at the time of publication but will consider a long position based on the monthly breakout. Any opinions expressed herein are solely those of the author for educational purposes only and do not in any way represent the views or opinions of any other person or entity.
Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.