Trade Setup – Taking JNJ Short.

February 2, 2015 0 Comments

Let’s take a look at the Ichimoku chart of JNJ.

As you can see it broke weak support on Friday. We have had multiple closes below the cloud. The lagging line is conforming the move. DMI shows that sellers are in control. It looks like a kiss on the MACD instead of a cross. Finally Parabolic SAR is in a sell signal. Do you see anything bullish with this chart? If you do then the trade idea I am looking at is not for you.

Trade Idea: Short JNJ w/ stop at $103.50. The stop is the standard line. (Blue line.) It’s just above the Parabolic SAR. First target is $96. In a green market today we may get a bounce. Any bounce to the cloud I believe is still a good short. Or it could open and just sell off. Keep in mind that it closed below support on Monday. The March 97.50 puts last traded at 1.53/1.64. Those are what I will be looking at today. Will be a very small position size.

Trade Smart,
Joe

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