BA: Mixed Kicking off the new year with an analysis on my fav stock. BA!
New years resolution is to just trade this more. Because its actually so much less dramatic than the rest of the market. So let's get into it:
Recap:
I did trade this last week, if you followed that idea. My initial TP was 192 and then 196/197. We kind of got halted at 192 and that was the extent of it. The market was quite heavy/range bound last week and that kind of translated over to BA.
Not incredibly upset with the trade because no loss was incurred. But kind of disappointed about the lack of momentum.
BA is in a really unstable uptrend channel:
On the daily you can really see it kind of looks like a wedge type setup.
Its interesting, BA formed what would traditionally be a bullish chart setup, but it failed to realize the "break up" move that would be anticipated with this kind of chart pattern. Instead its just sort of grinding higher and higher which makes me suspect it could tank.
The pattern I am referring to is here:
This is generally a BA specific chart pattern I have observed, but generally the defining characteristic is sort of a wicky type wedge, followed by a break up, a consolidation phase and then a move higher.
I have observed this setup quite a few times with BA and so that is what I am eyeing.
We also see that, despite the fact BA is succumbing to the market heaviness, it still hasn't managed to break down from its regression uptrend.
Analysis:
(EDIT ALERT: I used the wrong calculator to calculate the targets (I used SPY's model and not BA's specific model), the revised targets are listed in the analysis but just know that the targets displayed in the actual chart (the purple and yellow lines) are not accurate to the cents. Those targets are listed below in this analysis section).
So what am I targeting for next week?
Well, the 99% target within the next 2 days is 191.02.
If BA opens Tuesday below this target, I would be inclined to long, looking for it to hold at or above 188.06
If BA opens above that on Tuesday, I would be inclined to short it down to this level, and look for it reject at or below 193.98.
Probabilities on the momentum side are pretty 50/50. On an individual basis (looking at each technical probability in isolation and calculating the cumulative probability), there is a favoring of upside. However, in totality (looking at identical setups historically), it is really 50:50. Thus, I wouldn't necessarily be afraid to short, or long this, depending on the setup that presents itself.
My reference point going into Tuesday is that 191 target.
We will also have the weekly 99% target on open on Tuesday as well as the swing ranges (the ranges you see in the chart from the indicator BA Swing Model).
BA is reverting back to its slow moving ways, which makes it a great candidate as a set it and forget it type trade, waiting for the target to be realized within the next 1 to 2 days.
My thoughts as of now!
As always, trade safe and leave your questions/comments below!
