|Back to Back Issues Page|
The Inner Circle, Issue #447 - Moment of Decision
November 03, 2014
Moment of Decision
FROM: Moment of Decision.
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 10/31 CSCO closed 24.47 (Yield: 3.16%).
CSCO currently ranks 7th of the 10 highest yielding DJ-30 'Dow Dogs'.
CSCO currently ranks 1st of 5 lowest priced among the 'Dow Small Dogs'.
Key primary resistance algo to watch: 10/6 high 25.42 (highest high - last 3 mo).
CSCO recent resistance algo to watch: 10/6 high 25.42 (highest high - last 3 wks).
CSCO 10/6 high 25.42 has been re-confirmed to be the pivot point high on the weekly chart, a reasonable downside target would be 23.61. Target achieved 10/10 low 23.34.
NOTE: IF the 10/15 low 22.49 also turns out to be the pivot point low on the weekly chart, a reasonable upside target (intermediate term) would be 23.64 (IMO). Target achieved 10/24 even though the 10/15 low 22.49 has not yet been confirmed as the pivot point low on the weekly chart.
The 7/22 high 26.08 is indicating a reasonable (IMO) downside target of 19.81 (monthly chart).
However, IF the 10/15 low 22.49 also turns out to be the pivot point low on the monthly chart, a reasonable (IMO) upside target would be 28.35.
CSCO having found support(?) currently searching for resistance (IMO).
CSCO currently above both the 50 sma and the 200 sma on daily chart (Favorable).
CSCO currently above both the 50 & 200 sma on weekly chart (Favorable).
CSCO currently above the 50 sma but below the 200 sma on the monthly chart (Mixed).
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: 16.42. Forward P/E: 11.16.
Est Avg Yr EPS: 2.16. Est Yr High EPS: 2.27. Est Yr Low EPS: 2.00 (per analysts).
Next Qtr Est Avg EPS: 0.52. Est High EPS: 0.55. Est Low EPS: 0.51. Prior Qtr EPS: 0.43.
Next earnings date: 11/12/14.
Whenever 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!
|Back to Back Issues Page|