Lowe's is setting up to repeat previous large declines after its most recent earnings call. The stock has been in a bullish trend since 2015. The stock has cycled in tight channels up and down throughout this bullish run. Currently Lowe's just repeated movement that has resulted in a two quick 13% drops. Near-term downward movement is outlined below.
When we take...
LOW seems running within a wide upward channel, and at this time coming down from Upper channel line. We have earnings for it tomorrow, so we would like to see how it reacts. However if it shows weakness after earnings, we will consider for a short entry.
* Trade Criteria *
Date First Found- May 23, 2017
Pattern/Why- Upward channel formation with Earnings...
68 Seemed a fair market price for Lowes - Looking to potentially enter LT long on this dividend payer if we see a 8th test of the consolidation box.
Notice the triangle test along the 7th hit of the consolidation box - strong moves tend to come after years of consolidation and Lowes price could be setting up to make the top of the triangle broadening formation support.
LOW seems forming a head & shoulder formation & shaping up nicely for a short trade.
To trade this we would consider $72.50 / 70 Jun/July Puts.
You can check detailed analysis on LOW in the trading room/ Executive summary link here-
www.screencast.com (Available to subscribers)
Time Span- 43:40"
Trade Status: Pending
I am not long yet but here's my game plan for Lowe.
I have to humbly admit that I was in Lowe when if popped to $76 with some calls... but I rode the fade until I had a small loss ;-) From a significant gain to a small loss. Hats off to the faders on this one ;-)
I was pretty new at this game and I did lose some easy profits like this in the last few months...
