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. ORCL in focus today….
This journal entry looks at the recent market movements of Oracle Corporation NYSE: ORCL.
VantagePoint Trading Journal ORCL
Oracle Corporation (ORCL) provides products and services that address all aspects of corporate information technology (IT) environments, including application, platform, and infrastructure. The Company’s businesses include cloud and on-premise software, hardware and services. Recently, the market has not been kind to the bears, but take a look at this chart from VantagePoint:
This is one interesting chart. As a result of a disappointing earnings report, the stock could not hold its ground. That is not a good sign.
The fact that CSCO could not make new highs and broke major support is troubling. The artificial intelligence that powers VantagePoint indicated a bearish crossover on September 15. VantagePoint traders then see the neural index solidly in the zero (0) position. As a result, VantagePoint traders can see the upside is over.
If one were simply trading stocks, a short may be a prudent move with a stop at the highs around the $53.00 level.
Options traders can also use this chart to identify opportunities to the downside. One of the most crucial factors is to consider how implied volatility has reacted to the recent downturn. Short-term implied volatility is spiking to levels that not seen in months. This should have an options trader considering a credit spread.
We don’t want to have ourselves at risk for a long period of time, but we also would like to collect as much premium as possible. Let’s consider the 9/29/17 weekly options and look at the 48.50/49.50 call spread. Presently, this spread is trading $0.25. If one were to sell this spread, their maximum gain is the premium collected ($0.25). Their maximum risk would be the width of the spread ($1.00) less any premium collected ($0.25) which would be $0.75. This would give the spread seller a risk to reward ratio of 3:1.