Note from Daily Trade Alert: We’re always on the lookout for high-quality trade ideas that our readers can profit from. That said, we’re thrilled to announce that each trading day in the month of May we’ll be offering you what we call our “Trade of the Day.” This trade idea comes courtesy of one of the most respected traders we know: Invested Central Chief Market Strategist and StockCharts.com contributor Tom Bowley. In short, Tom has taught thousands of traders around the world how to analyze the markets and make money trading. We’re thankful he has agreed to share his ideas with Daily Trade Alert readers and we’re confident you’ll benefit from his insight. Without further adieu, here is today’s “Trade of the Day”…
CIT Group (CIT)
is a $9.4 billion financial company that operates as the holding company for CIT bank that provides commercial financing and leasing products, as well as deposit products and savings accounts.
In early March, CIT moved to fresh highs, but had a lower MACD reading, or long-term negative divergence, present.
That required some selling and a period of consolidation.
CIT consolidated in a bullish cup with handle pattern. The bottom of the cup tested key price support just beneath $41.00.
Weakness felt over the last 1-2 weeks actually formed the handle down to the 20 day EMA on fairly light volume – a classic handle.
CIT is now a bit overbought, but should be considered on a Watch List.
Tom’s Take: We like entry on any pullback to test price support near the $45.00-$45.25 range. Consider a closing stop beneath the rising 20 day EMA, currently at $44.36. Our target would be the measurement of the pattern, or $49.25-$49.50.
– Tom Bowley, Invested Central
No comments:
Post a Comment