Today’s Featured Trade Idea is GSM.

Members can join us in Trading Room #1 as Rick reviews the GSM 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.

GSM has been in a long-term downtrend. However, a month ago the bulls stepped in to reverse matters. After a very strong run that took GSM into a RBB pattern, the stock has been in a profit-taking pullback the last couple weeks. It is important to note that it held the 50sma and a support level (about 7.95) on the pullback. Now the bulls have stepped back in and pushed off that support.

I will look for a b/o Entry with a Stop down at the tops of the most recent pullback highs. The targets come from long-term charts 5-8day charts) and I am planning this as a 2 target plan…but a 3-target plan is certainly possible if the overall market cooperates and GSM continues to work.

Trader Vision tells us we have 2 months until the next earnings report. It also tells us that we have 5 bullish versus only 1 bearish condition. We also expect this bearish condition since the stock has been in a successful pullback (which held support). So we can tell this is a nice chart setup.

TV20/20 then tells is that this trade plan offers us a decent Reward/Risk at the 1st Target price (2.12:1, with the ability to essentially make our Trade Goal at that point). However, if we can sell half at the 1st Target while holding the remainder until Target 2, we can get a 3.3:1 Reward Risk ($527.50 / $160). Overall, this would give us a 12.38% trade.

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 GSM Trade Setup – As of 9-20-18

The Trade Plan

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.

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