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The Inner Circle, Issue #493 - All this will go away if...
September 27, 2015
Repeat: All this will go away if...
FROM: All this will go away if...
Stocks rise until they meet resistance then reverse until they find support.
Cisco Systems (CSCO):
MarketClub's Trade Triangle Technology algorithm currently ranks CSCO Primary (monthly) Trend 'DOWN'.
Week ending 9/25 CSCO closed 26.02 +1.8% (Yield: 3.31%) 13th highest yielding among the DJ-30.
CSCO is not currently among the 10 highest yielding DJ-30 'Dow Dogs'.
CSCO is not currently among the lowest priced/highest yielding DJ-30 'Dow Small Dogs'.
Key primary resistance algo to watch: 6/1 high 29.62 (highest high - last 3 mo).
CSCO recent resistance algo to watch: 9/9 high 26.73 (highest high - last 3 wks).
CSCO has currently found resistance at 9/9 high 26.73 (IMO).
CSCO has found support at 9/24 low 24.92. (IMO).
CSCO currently below both the 50 sma and the 200 sma on the daily chart (Unfavorable).
CSCO currently below the 50 sma but above the 200 sma on the weekly chart (Mixed).
CSCO currently above the 50 sma but below the 200 sma on the monthly chart (Mixed).
Current upside target on the weekly chart: 25.39 (Achieved 8/25 high 25.99).
Current downside target on monthly chart: 24.04 (Achieved 8/24 low 23.03).
Symmetrical Triangle Info:
NOTE: IF the 8/24 low, 23.03, also turns out to be the pivot point low on the weekly chart, a reasonable (IMO) upside target would then be 25.39 (Achieved 8/27 high 26.19).
NOTE: IF the 8/24 low, 23.03, also turns out to be the pivot point low on the monthly chart, a reasonable (IMO) upside target would then be 33.12 (+27.29%) from here.
NOTE: The 26 area appears to be an important historical horizontal line.
Earnings: 5 yr avg EPS: 1.54. (ttm) EPS: 1.75. Current P/E: 14.87. Forward P/E: 11.04.
Est Avg Yr EPS: 2.30. Est Yr High EPS: 2.44. Est Yr Low EPS: 2.16 (per analysts).
Next Qtr Est Avg EPS: 0.56. Est High EPS: 0.59. Est Low EPS: 0.55. Prior Qtr EPS: 0.45.
Next earnings date: 11/11/15.
The combination of low price/high yield + support at the 50 & 200 sma (weekly charts) = opportunity in the intermediate term (IMO).
Whether you buy stock, protect with puts (& collect dividends) or buy calls, puts, or do debit/credit spreads, straddles/strangles, or combinations, "combo's" (my personal favorite), whatever suits your trading style, a limited risk/high reward position can be constructed.
Each strategy has its own follow-up tactics, depending on how it plays out.
NOTE: CSCO is the leading company in cyber security; we are constantly under cyber attack.
Comments? Ideas? Feedback? Let me have it, right between the eyes! I'd love to hear from you. Just reply to this zine and tell me what you think!
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