AMD Setup and Trade Plan

Today's Featured Trade Idea is AMD.

Members can join us in Trading Room #1 as Rick reviews the AMD setup and other Trade-Ideas at 9:10am Eastern.  For now, here are my own analysis and a potential trade plan made using our Trader Vision 20/20 software.

AMD has been a long-term bullish trend. The most recent leg up ran strong for a month and then formed a nice Bull Flag that culminated in a Morning Star signal on Monday. Based on long-term charts showing resistance at the recent high area, I will look for a b/o Entry.

I sill use a fairly tight Stop and use the level where a 32.8% Fib Extension of the most recent run-up and a long-term S/R level coincide as my 1st Target. The 2nd Target will be the area where long-term (all-time) highs topped out back in 2006.

Trader Vision tells us that we should have at least a month until the next earnings report. It also shows us that we have 5 bullish conditions (should be 6 since the 3 most recent candles are close enough to a Morning Star signal to call bullish) versus only 1 bearish condition (short-term overall market trend).

TV20/20 allows us to play with position size to find the most profitable size that allows us to stay below our position size threshold...and tells us the amount of risk to Stop that would give us. It also shows us that this plan offers an excellent 3.69 : 1 Reward/Risk at the 1st Target. In addition, if we closed the trade there, TV20/20 tells us we could book $708 in profit. However, if we sell half of the position at Target #1, we can book our Trade Goal profit ($354). If we sell the remainder at Target #2, we achieve an overall 4.25:1 Reward/Risk while booking $816 in profit.

Having this knowledge before a trade is even entered makes it much easier to control emotions and maintain discipline.

Below is my markup of the chart and the trade plan as laid out by Trader Vision 20/20.  As a bonus, if you click the green button below, you'll be able to watch a video of the chart markup and trade planning process.

The AMD Trade Setup - As of 9-24-18

AMD Chart Setup as of 9-24-18

The Trade Plan

AMD Trade Plan for 9-25-18

Note how Trader Vision 20/20 does so much of the work for you.  Knowing the ratio of Bullish Conditions to Bearish ones as well as the overall risk of the position size, risk to Stop out and the Reward possible at each Target price can help a great deal with controlling our emotions.  Knowing the dollar impact of every scenario ahead of time, allows us to make calm decisions during the trade.  It really takes the pressure off.  No guesswork.  No surprises.  No emotional roller coaster.

To see a short video of this trade's chart markup and trade planning, click the button below.

 

Put the power to Trader Vision 20/20 to work for you...

 


Testimonial

Trader Vision immediately simplified the process...immediately it provided that information and guidance to me. I knew what I would risk for how much reward, I began taking trades off at the 1st target, 2nd target, I was no longer holding all my trades for the homerun. I also began implementing the stop losses if and when they were reached, not just hoping the stock would recover.  It then became easier to see what patterns were working for me and which were not.  It provided a much more relaxed and stress-free environment. -Joan G

 

***************************************************************************************************

Investing and Trading involve significant financial risk and are not suitable for everyone. Ed Carter is not a licensed financial adviser nor does he offer trade recommendations or investment advice to anyone. No communication from Hit and Run Candlesticks Inc. is to be considered financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.

***************************************************************************************************

Comments are closed.

Skip to toolbar