GIII | G-3 Apparel Group Trading Journal with VantagePoint

VantagePoint Trading Software is a forecasting tool that uses both end of day data and artificial intelligence to provide traders a forecast of market movement. These forecasts are 1-3 days in advance and help traders improve their timing on making trades and maximizing profit potential. The artificial intelligence software forecasts market movement for stocks, futures, Forex and ETFs. GIII is in focus today….

This journal entry looks at the recent market movements of G-3 Apparel Group NASDAQ: GIII

VantagePoint Trading Journal GIII

The market is again without a barometer. Four of the heads of the central banks met this week in Frankfurt for an ECB hosted panel. During her time at the podium, Janet Yellen admitted the Fed could be confusing the public with its many voices and said: “…this really is one of the challenges of our system.” This doesn’t really bode well for us traders.

What does provide potential for us is using the powerful tools at our disposal. Using the artificial intelligence forecasting software VantagePoint, we can analyze individual stocks, futures or ETFs and broad indexes like the S&P, Dow, and the Russell. After utilizing our VantagePoint platform, I am looking for value plays to the upside in strong sectors. Let’s look at retailer G-3 Apparel Group (GIII):

image of GIII trading diary with VantagePoint
VantagePoint recently indicated the bearish trend in GIII could be turning around after a bullish crossover on 11-13.

Using the predictive indicators embedded within the VantagePoint platform and its predictive AI technology, we will point out two significant things. We have a bullish crossover indicated by the blue predictive indicator line crossing above the black, simple 10-day moving average on 11/13/17. We can combine that with the VantagePoint propriety neural index indicator moving from the zero (0) to the one (1) position. This indicator measures strength and weakness for a 48-hour period. The movie to the one (1) position further makes the case for a potential bullish scenario. That’s why I am willing to entertain a setup to the upside.

Strategy Discussion

If one were a straight stock trader, simply buying GIII in the $25.50 area could prove to be prudent. You are anticipating a continuing move to the upside. It’s also a conservative way to enter GIII without the limitation of time associated with other strategies. In this scenario, it would also be good practice to place a buy-stop order in the $24.50 area to mitigate potential losses.

For more active traders with a shorter investment time horizon, you can consider options. Because of the layered uncertainty in the market, I believe it is practical to buy some more time by going out to the regular December options.

From three simple inputs, we can compute the magnitude of the projected move through expiration.  Those three inputs are the underlying price, at-the-money implied volatility and the date of expiration.  Performing this calculation for GIII yields a projected move of approximately $4.00 or 16%. This targets the $29.00 price level through the December expiration. Let’s consider a possible bullish set up using the GIII December 25/30 vertical paying $1.50. This will have a maximum risk of what one would pay for the spread ($1.50). The maximum reward will be the width of the spread less any premium paid or $3.50. This yields a reward to risk ratio of 2.33:1. Given the trading environment outlined above, a trader must evaluate whether this reward/risk ratio is appropriate for his/her risk tolerance.

image of vantage point software banner

tylerr@tradermarketinggroup.com'

Leave a Reply

Your email address will not be published. Required fields are marked *

Translate »