ILG ascending wedge
Updated
ILG is showing the following bearish signs:
Furthermore, it's put "sizzle index" (aka the demand and relative volume of put options) is skyrocketing, meaning that the owners of this stock are wanting downside protection. All very strong downside signals.
Strategies:
(a) enter short immediately, but exit at the touch of the ascending line. This is essentially a swing play based on the shooting star candlestick. Your price target would naturally be around 18.60, but this depends on time value.
(b) enter on break of supporting ascending trendline. Your price target could be as low as $14.00.
You could also combine the two strategies, using april put options for strategy (a), selling, and then using profits to buy june or july put options for strategy (b).
- Ascending wedge pattern
- MACD divergence
- Decreasing volume
- Shooting star candlestick
Furthermore, it's put "sizzle index" (aka the demand and relative volume of put options) is skyrocketing, meaning that the owners of this stock are wanting downside protection. All very strong downside signals.
Strategies:
(a) enter short immediately, but exit at the touch of the ascending line. This is essentially a swing play based on the shooting star candlestick. Your price target would naturally be around 18.60, but this depends on time value.
(b) enter on break of supporting ascending trendline. Your price target could be as low as $14.00.
You could also combine the two strategies, using april put options for strategy (a), selling, and then using profits to buy june or july put options for strategy (b).
Trade active
I'll actually update this trade for once.Entered trade around noon eastern time today with the 19.00 PUT option purchased for 0.30 each. Current bid/ask spread already at 30/45, as there was some nice downside pressure in the last hour to give us a great engulfing candle.
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