Setting Up Two Trades
I haven't been a huge fan of Equinix(EQIX) lately, as the stock is now somewhere in growth-yield purgatory awaiting a shift over to real-estate investment trust (REIT) status in the coming years. However, when I look at the current chart for earnings, I can't help but lean bullish. The falling wedge pattern along with the "double push" in the stochastics has me looking for $197.50 post earnings. The double push in the stochastics, which is a move above $20, back under $20, then back above $20 again, is something I view as bullish. I use the opposite back when stochastics are overbought (Above $80) when looking for short entries, and the opposite works as well. I favor the November $185-$200 call spreads for about $6.20.Equinix (EQIX) -- Daily Source: StockCharts.com View Chart » View in New Window »
If I were going to go for the home-run ball, or lottery ticket play, on one name, it would probably be Green Dot (GDOT). You'll see the same double-push pattern here in the stochastics and a small bullish divergence in the RSI. The November $10 calls around $0.85 look appealing to me for a high risk-high reward trade. GDOT has already gotten hit for 67% on the year, but bulls have now created a floor around $10. With the current 17-plus% short interest along with very low expectations and a floor very near the current price, the technical picture along with these factors would allow for a quick squeeze back into the $12 range. The overall sector has seen enough strength for me to give this one a shot with the most aggressive of funds....163 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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