HZNP Setup and Trade Plan Be Careful - 3day Weekend Risk

Just be careful taking any new trades today.  We are going into a 3-day weekend with the market showing some weakness at all-time highs.  We also have volatility-inducing headline risk with the President threatening $200billion ins new Tariffs on China as soon as next week, but also claiming we are very close to a trade deal with Canada (who he says will be forced to sign a deal very soon).  In that environment, 3 days where you are unable to adjust trades could seem like an eternity.

That said, today's Featured Trade Idea is HZNP.

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

Bear in mind, the market is toppy at all-time highs. We also face a 3-day weekend with Intl. Trade fear and (posturing via media and Twitter). That headline risk on an already nervous market looking to maybe take profits makes ANY trade more risky now. Trade at your own risk.

That said, HZNP shows a nice setup. It's been trending bullish since May and after a 2-week consolidation it looks like it has found support off a 23.6% Fib. Retracement. On Thur. it printed a Bullish Engulfing signal of a Doji. I'll look for follow-through above the pre-pullback high closes. My Stop will be just above the recent Support and my 1st Target will be the alignment of Weekly S/R and a 38.2% Fib. Extension.

Trader Vision tells us that earnings are out of the way for over 2 months. It also shows us that we have 5 Bullish Conditions versus 1 Bearish Condition (short-term pullback or consolidation) in favor of the setup. In addition, it tells us we have plenty of liquidity on this ticker.

TV20/20 also shows us that this trade plan can achieve our Trade Goal even prior to reaching Target #1. However, if we did reach the 1st Target, we could sell the whole position for $450 profit, achieving a 3.31:1 Reward/Risk. If were able to sell only half there and hold the rest until the 2nd Target, we'd get 4.28:1, booking $582 in profit and netting a 13.9% overall 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 HZNP Trade Setup - As of 8-30-18

HZNP Chart Setup as of  8-30-18

The Trade Plan

HZNP Trade Plan for 8-31-18

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

 

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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.

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