Wednesday, October 3, 2012

CAT Looks About Ready (long)

The last time we traded CAT it was as a core short and looked like this...
 CAT was phased in to a short position in the red square and covered at the low of the white square. That was nearly a +24% gain on a large cap using no leverage, not bad. In any case, I can't say this is going to be a core position, but I've read your emails lately and I see in this chop a lot of you are trading nimbly and well, today we had a member make 30% on IWM puts just off a market update.
 
 CAT has a small base like price pattern, the open gaps are in yellow, but CAT could go on to make a higher high, it's more of a swing trade, but the probabilities are looking good.

 The 15 min chart showing the last positive divergence that caused me to close the CAT core short, that was a decent run, now we  a similar leading positive divergence on the 15 min chart.

 The 10 min is leading positive as well and looks like it's getting ready to go.

The 3 min chart is leading to the upside in a big way.

And now the 1 min is too, when there's a longer term positive like the 15 min in effect and the short term timeframes start rolling around our way, the trade is pretty ripe in most instances. There was a small neg. divergence toward the end of day so I'd look maybe for a mall pullback around the $84.50-$85 area. There may be 10 points in this trade just on a swing.

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