FND Setup and Trade Plan

Today’s Featured Trade Idea is FND.

Be Careful: With the Fed Meeting on Wed-Thu and a lot of earnings the next couple days…markets will likely be volatile.  Just remember the trend is still Bearish until we have a higher low and higher high.

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

FND had been in a long-term downtrend. However, it reported earnings on 11/1, experiencing a violent and volatile reversal to break up into an RBB pattern. After consolidating for 2 days to retest the 50sma the next two days, the Bulls stepped in on Tuesday to form what can be seen as a Morning Star (and/or a Bullish Engulfing signal) on Tuesday.

I will look additional confirmation with an Entry above Tuesday’s High and a Stop below Tuesday’s Low and the 50sma. The Targets were chosen based on the Daily and Weekly charts.

Trader Vision shows us the earnings are out of the way, giving us 3 months until they come around again. It also shows us this trade setup has 2 Bullish and 3 Bearish conditions (should be 4 Bullish) as the Bearish pattern is a false read and while not technically a Bullish signal, it is close enough.

TV20/20 shows us that this Trade Plan offers moderate Risk to Stop ($170), but good potential Reward ($563) for a 3.31:1 Reward/Risk overall. However, it also tells us we can achieve the trade goal for this trade even before reaching the 1st Target. And if we do reach that 1st Target, we can get a 2.31:1 Reward/Risk at that point.

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 FND Trade Setup – As of 11-6-18

FND Chart Setup as of 11-6-18

The Trade Plan

FND Trade Plan for 11-7-18

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, the 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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