Do you wait for the close before you call a breakout?
Hi trader,
Most false breakouts have one thing in common: somebody acted on a wick. Price pokes through resistance during the day, the trade goes on, and by the close it has slid back under.
A close is different. It is where the day's buyers and sellers settled. When a stock closes through a level it had been held under, that is a breakout you can actually plan around.
That is the whole idea behind MagniZone 2.0, our new zone scanner. It reads 251 stocks and ETFs at every daily and 4-hour close and runs four checks before it calls anything. When a setup passes, you get a card with the entry, the stop, two targets and the at-the-money option, priced at that same close.
Here is Cameco in January, called at the close and played to the end with the option card up:
CCJ, called Jan 15 at the close. The Mar $115 call on the call: $8.80 to $22.50.
And Lockheed Martin, called on January 6:
LMT, called Jan 6 at the close. The Mar $520 call on the call: $25.80 to $124.75.
Not every call works. Some get stopped out, and every call and its result stays on the scorecard.
MagniZone 2.0 is drop 1 of our Indicator Bonanza, and it is at its drop price, the lowest it will be, until tomorrow (Sunday) at midnight ET. Then it steps up, and on November 1 it goes to full price.
The Trading Strategy Guides Team