I received a few emails today on existing trades and setups and since I’ve been working towards updating many of the active trades, I wanted to share my thoughts. The first inquiry was for an update on MA & V. From what I hear, CNBS is drooling all over these two credit card stocks right now an here are my thoughts on the first of the two (V to follow under separate email for categorization purposes).
MA was a very successful trade on the site several times, long and short, in 2012. On the last update back on Oct 25th, although MA had already hit the first profit target, I decided to leave the existing short trade on but I had also added MA as a new short setup with new targets. Obviously, that original short is now well underwater as the stock has continued to find support on the bottom of the channel and as such, the most recent set-up has not yet triggered a short entry (which will be a break below the channel). As far as stops for anyone still short, that can only be determined based on your particular entry price(s), preferred profit target(s) and unique risk tolerance/trading style.
Although I felt confident that MA would have broken below the channel by now, I was obviously wrong. However, I am leaving MA as both an active trade and a short setup with the same criterion for the next sell signal (a break below the channel, preferably impulsive or an end of day close below). This chart looks even more bearish to me now that it did back in Oct and I believe that MA has the potential to be a very lucrative swing short in 2013. What stands out to me now is what looks like a wedge overshoot within the channel and if so, prices so reverse and move below the channel soon. Also note that I have adjusted to the targets since the previous chart (below) as prices have moved high enough to make the former S1 level the new first target (and so the remaining targets were renumbered). Previous and updated daily & weekly charts below:
