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Ice Cold Traders
Posted On: 10/14/2012 12:02:29 PM
Post# of 474
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Posted By: coolnapz

$CAT Short triggers


$CAT has been a non stop money making for me on the day trading front as it has been conforming to intraday patterns. The daily chart shows that this stock looks to breaking down. However, we have to be careful in playing this as earnings will be out on 10/22. I don't intend on playing earnings because that can whip either way and good news could be bad news and bad news could be good news.


In the chart below we have multiple bearish factors lining up.


1. 20 DMA crossed below the 50 DMA


2. Price is chopping along the low support at 82.50


3. Price is below all moving averages


The only thing holding the stock up at this point is the 82.50 trendline support on the daily, and notice that it has been there 4 times and is not getting a very good bounce this time.


If this thing really breaks it should hit 80 bucks and cut through it on the way to 70 bucks. I am looking for the stock to either retrace a bit higher to the 85 level with a stop on a close above the moving averages. Or alternatively for a close below the 82.50 support on a daily with a stop on a daily close back above the 82.50 support.


I am very cautious with this stuff because I plan on using short dated options and I really need a quick in and out play otherwise the Greeks really start to kill me on the position.


7It6d.png


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