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The Inner Circle, Issue #438 - ISIS Threat Level Elevated to Severe!
September 01, 2014
Hi <>,

ISIS Threat Level Elevated to Severe!

FROM: ISIS Threat Level Elevated to Severe!

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 'UP'.

Week ending 8/29 CSCO closed 24.99 (Yield: 3.06%).

CSCO currently ranks 8th of the 10 highest yielding DJ-30 'Dow Dogs'.

CSCO currently ranks 1st of 5 lowest priced among the 'Dow Small Dogs'.

Key primary support algo to watch: 8/15 low 24.27 (lowest low - last 3 mo).

CSCO recent algo: 8/11 high 25.37 (highest high - last 3 wks).

NOTE: If the 8/15 low 24.27 also turns out to be the pivot point low on the weekly chart, a reasonable upside target (intermediate term) would be 27.92.

The 12/13 low 20.22 on the monthly chart is indicating a reasonable upside target of 31.75.

However, IF the 7/22 high 26.08 also turns out to be the pivot point high on the monthly chart, a reasonable downside target would be 19.81.

CSCO currently searching for resistance.

CSCO currently below the 50 & above the 200 sma on daily chart (Mixed).

CSCO currently above both the 50 & 200 sma on weekly chart (Favorable).

CSCO currently above both the 50 & 200 sma on the monthly chart, however, the 50 sma is below the 200 sma (Cause for concern).

Earnings are rising (as announced after the close 8/13). However, management expects lower revenues going forward, cutting 6000 jobs & concentrating on areas that are growing (such as 'cloud').

Earnings: 5 yr avg EPS: 1.40. (ttm) EPS: 1.49. Current P/E: 16.77. Forward P/E: 11.51.

Est Avg Yr EPS: 2.16. Est Yr High EPS: 2.27. Est Yr Low EPS: 2.03 (per analysts).

Next Qtr Est Avg EPS: 0.53. Est High EPS: 0.55. Est Low EPS: 0.51. Prior Qtr EPS: 0.43.

Next earnings date: 11/12/14.

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 (whatever suits your 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 deeply involved in cyber security; we are constantly under 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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