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. SWK in focus today….
This journal entry looks at the recent market movements of Stanley Black & Decker. NYSE: SWK.
VantagePoint Trading Journal SWK
The market continues its slow slog to the upside this week. In the same way, we can analyze individual stocks, futures or ETFs using VantagePoint and its artificial intelligence predictive software technology, we can apply the methodology to broad indexes like the S&P, Dow, and the Russell. All three of these major indexes continue to show strength. That could tell a trader to start looking for some bullish opportunities. Let’s look at Stanley Black & Decker (SWK):
Using the predictive indicators found within VantagePoint, we will note two significant things. The first is that we have a bullish crossover. We see this due to the blue predictive indicator line pictured above crossing above the simple 10-day moving average on 9/30/17. But, before we consider taking a position, we want to look for confirmation. That’s where we couple the movement of the VantagePoint neural index indicator (green line) from the zero (0) to the one (1) position. This confirms we have short-term bullish momentum and can consider a bullish position.
If one were a straight stock trader, simply purchasing the stock in the $155.00 area could prove to be prudent in anticipation of continued bullish movement. It’s a conservative way to enter SWK because you don’t have the limitation of time associated with other trading strategies. It would also be smart to consider a stop order in the $150.00 area to mitigate potential losses.
If you were a more active trader with a shorter investment time horizon, a play with options could prove to be advantageous. The measured move through the October regular expiration on 10/20/17 is calculated to put SWK in the $160.00 area. This would be an approximately 3% move. If this proves true, perhaps utilizing the regular October monthly expiration options with a vertical spread would make sense. The 155/160 bull call vertical is trading $1.75 today. The total risk for this spread is what you pay for it ($1.75). The potential profit is the width of the spread ($5.00) less any premium paid ($1.75) for a net potential of $3.25. This yields a reward to risk ratio of 1.86:1.