One More Stock Trade Setup

Going through the relative strength list this morning, I did have one more setup I wanted to include but the email was getting a tad long. 

I just wanted to pass this along, though. 

SBUX

SBUX has been a Relative Strength beast and has been trading quite well. 

However, it’s been riding lower with the market lately and is set for a 1% gap-down this morning following a downgrade from Jefferies. 

Set to open at/near the 10-week moving average and at the 23.6% retracement, this one may be worth a short. 

Personally, I like the Jan. $100 calls. I like the options because my risk is limited to the price paid. If I buy 10 calls at $2.00, my risk is $2,000. X * Y = Z, and Z should be a small, tiny part of one’s overall trading account. 

If you don’t trade options, don’t let this setup be your first. Common stock is fine, I’m just trying to be transparent. 

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Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.

Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!