A Trade A Day

I feel like such a loser. I’m not going to the Trader’s Expo in Las Vegas However, I will seriously consider the one in NYC. The city would be fun and I can visit some friends to boot. Anyway, today’s trading idea is brought to you by VIVO.

VIVO is in the early stages of forming an ascending triangle. The trade is to play the hammer that has formed against the support of the 50 day SMA. Given the carnage the bears have inflicted on the market, I’m playing any longs very carefully.

Honestly, I’m trying to restrain any bias I have in picking my trades. It’s been difficult of late because some of the success
I have had with my shorts. I expect a retracement, but whether any up move turns into a continuation of the long term uptrend is anyone’s guess. The VIVO trade is in a good position to take advantage of any market retracement. An uptrending market, even a brief move, will help VIVO move back up to the 34 area.

Let’s take a look at the chart:

Just to recap why I think this is a good trade:

1. Clear Hammer pattern formed against support from 50 SMA
2. Heavy volume: ~500k. (My chart shows over a million. I’m not sure why.)
3. A short term upmove in the stock is supported by the longer term price pattern.
4. A potential retracement of the indexes supports a short term long trade.

See you tomorrow!

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