DFS trade ideas
Room for growthGood dividends (why I bought and am keeping them). I believe we will continue to see an exponential recovery and then once it is back in its normal price rage a very slow growth but still a growth. I would recommend buying anywhere in the 60 range before it jets to 80, however, it will probably coast after that.
Looking at DFSDFS is fundamentally weak in XLF in the pandemic giving it's high exposure to personal finance. The first dip is already 0.236 fib line.... So I would use this fib level on leaders in XLF such as JPM as the starter to long.
Undoubtedly banks suffer a lot from personal finance and commercial related loans due to COVID-19. But post 08/09 it's balance sheet was positioned for less leverage and has high reserve ratio. I think longer term they are not bad investment in IRA. But be aware that financials sector will be involved with everything crash, not matter who triggers it. So don't rush into it without a "vaccine".
Double Bottom Formation Makes DFS a Screaming BuyKeep in mind, charting patterns in this coronavirus-driven market may seem like a bad idea. So let's take a look at the financials: Dirt cheap even for the recession we're in (P/E ratio: 3.41) and certainly oversold (RSI dropping below 30). Nice paying dividend currently over 5% - DFS is a screaming buy right now. Buy it and ride these tough times out.
DFS buy on over extended sell offWeekly analysis:
- Nice climatic selloff insanely huge volume on earnings day
- Really good bullish volume at support around 75 (this volume is only 3 days in for this week)
- Support at 75 is quite strong (many touches at key levels)
- Weekly is still considered on a uptrend
Daily analysis:
- Nice void above, not much resistance to 2R
- Spinning top followed by a hammer like candle. Both with decent volume (about double the average)
- Hammer like candle also gapped up on open. Shows bullish commitment in terms of price
Intraday analysis:
- Two higher low
- EMA sloping up
Cons:
- Candle is not a real true hammer as the body is about half of the candle size.
- Candle is red. Preferably we want a green hammer as it has a higher strength.
The reason why I still proceeded was because the hammer gapped up on open which sort of make up for the bearish pseudo hammer
DFS earnings updateFor everyone I do not care about. On my long position I did what I said I was going to do, I sold my contracts at around 86.20 when DFS saw a surge in volume due to impending earnings. I made around 39% profit off this trade. So I am not feeling too bad. But hey, Ill probably die on my next trade.
DFS is trading at 77 dollars at the time of this post and it beat expectations on its Q4 2019 earnings.
DFS earning reportThis is for me and I do not care what you think.
The last 3 out of four earnings report have all beaten expectations. But shortly after each of these calls saw a growth in price. Almost every day before the call there is a surge in volume in price. I am going to go long for DFS maybe buying a 87, or an 88 dollar call. I may sell day before the call to capitalize on profits. But we will see how things play out.
This is a short term call
DFS - DAILY CHARTHi, today we are going to talk about Discover Financial Services and its current landscape.
As nowadays we live in a consumerist society and access to a credit card has continually become easier to obtain, is reasonable to predict that the card debts are also going to rise too, as financial education isn't the strong point of U.S consumers, and are used to the debt culture.
The heat up U.S economy put credit card companies in a more comfortable zone as the unemployment rate remains near to historic lows, which helps customers to keep up with their bills. However, the question that worth to be raised here is, if the 90 days past due card debt is probably surging to 2.01%, the highest level since 2010 amid a heated economy, what is going to happen with this type of debt, once the U.S economy make its first downward movement of correction and make harder for customers pay their credit card bills. Even with the credit card issuers tighten their credit standards, we can't be sure it's going to be enough to avoid a crisis on the sector, which could lead to a flood of bad debt, decline of new credit card issuance and other types of liabilities. This scenario could mean concerning news for Discover Financial Services if the company doesn't progressively start to deploy the proper countermeasures for this scenario.
Thank you for reading and leave your comments if you like.
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DFS - Bull Put SpreadHigh Vol. High Beta Stock.
RSI <25 and PA struggling to go below 81.
Looking for Reversal to mean higher.
Taking 81/80.5 Put Credit Spread.
Also picked up 81.5 Call for Directional Bias Higher.
Oct Exp but aiming to Close in profit well before that...
Good Luck - Watch your $$$ RISK
