Here is your Bonus Idea with links to the full Top Ten:
Citrix Systems (NASDAQ:CTXS) is probably most well known for their product, GoToMeeting, a service that allows on line meetings with colleagues and clients. Everyone has used it. But the company offers a full line of virtualization, mobility management and networking solutions.
The stock had started moving higher in April, eventually retesting the September 2014 high. A slight pullback created a Cup and Handle pattern, and this is still in place with a target of 89.50. But the price pulled back hard to end last week.
The RSI pulled back hard to as momentum shifted to the downside, while the MACD crossed down and fell. The RSI is still in the bullish range, but with more downside in the market, this may be one stock that will catch up.
There is support at 73 and 71 followed by 68.25 before 67.40 and a gap to fill to 66 then 64.25. Resistance above may come at 74.80 and 77.25 followed by 78.30. Short interest is low under 2% and the company is expected to report earnings next October 21st.
Looking at the options chains, the September set shows big open interest on the Call side from 65 to 80. On the Put side, the biggest open interest is at the 67.5 and 62.5 Strikes. There is minimal activity in outer months at this point.
Citrix Systems
Trade Idea 1: Sell the stock short on a continuation lower (under 73.91) with a stop at 75.
A straight stock trade with stop loss to manage risk.
Trade Idea 2: Buy the September 75 Puts (offered at $3.00 late Friday).
A controlled risk way to participate in the downside.
Trade Idea 3: Buy the September 72.5/70 Put Spread ($1.20).
Adds leverage to the short defined risk trade.
Trade Idea 4: Buy the September 72.5/70 Put Spread and sell the September 80 Call (80 cents).
Adds more leverage and upside risk above the large open interest at 80.
After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which, heading into the last full week of August sees the Equity markets looking horrible, ready for more downside.
Elsewhere look for gold to continue in its uptrend while crude oil continues lower. The US dollar index is consolidating sideways with a downward bias, while US Treasuries are biased higher. The Shanghai Composite and Emerging Markets are biased to the downside with risk of the Chinese market running sideways in consolidation.
Volatility looks to remain elevated above the prior stable period, but usually does not hold these levels long. This will keep the bias lower for the equity index ETF’s NYSE:SPY, NYSE:IWM and NASDAQ:QQQ in the short run. Their charts suggest the downside move is not over, but all are very oversold and could see short term bounces early in the week. Use this information as you prepare for the coming week and trad’em well.
Disclaimer: The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog. Please see my Disclaimer page for my full disclaimer.