Thursday, June 30, 2016

#PCLN Bias & Levels Update for Thursday June 30, 2016 by @mocktrade

#PCLN Bias & Levels Update for Thursday June 30, 2016 by @mocktradeSocialTwist Tell-a-Friend

Originally and before both the June FOMC rate decision and Brexit I was holding a bullish bias for PLCN and I was in hope for a exit out of the Call side of a Strangle from/if a follow through move (with legs) above the 1385s resistance. PCLN did breach above 1385 on Thursday the day before Brexit but unfortunately the move occurred on very low volume and was also very short-lived, which then forced me to hold through the Brexit vote.

Then on Monday (June 27th) PCLN had continual bearish follow through from Friday so I started to look at potential supports to exit out of the Put side for a profitable Strangle rather than the Call side. The first key support I saw was at the bottom of a low volume area (LVA) at 1161s/60s.

Thankfully the 1161s/60s target was reached which allowed me to exit the Strangle with a decent (not huge) profit after an almost full 250 point reversal.

Now I am taking note to the fact that although PCLN is currently trading a little more than 100 points above Monday’s low PCLN in not in the same type rally mode as the overall market, and is also losing energy at about the middle of a 100 point range between 1303 & 1203. This has me eyeing another (new) Strangle entry if PCLN now trades sideways for the rest of the week between 1285 & 1240. If so I plan to engage today/tomorrow with a September or October expiration.

Once/if engaged in the new Strangle I will then be looking for either a move above 1303s once/if first breaching above 1291 or a move below 1203s once/if first below 1228s.

Ethan Premock Futures & Options Strategist at Hamzei Analytics, LLC 

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