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Dow 30: The Travelers Companies Trade Recommendation

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On April 18, 2018, a short recommendation on The Travelers Companies’ stock was issued. Having met and exceeded its downside target, as well as based on recent price action, the stock is now a technical buy.

Technical Developments since April 18,2018

  • Over the next few sessions, until April 23, TRV continued to oscillate within the narrowing trading range formed by the upward-sloping support (green trendline in Figure 1) and the downward-sloping resistance (red trendline).
  • On April 24, the stock gapped down after a 1Q18 earnings miss (white arrow).
  • After failing to move back above a horizontal support-turned-resistance formed by the Feb and April lows (orange horizontal trendline at $133), the stock slid to as low as $125.15 on May 3.
  • The stock continued to find resistance at the downward-sloping trendline (red trendline) at each retest (last 3 red arrows). On Thursday (June 7 – second last candle), TRV managed to close above the trendline.

Figure 1. TRV Daily Chart

  • On Friday (June 8), the stock broke above the neckline of an inverse H&S pattern (lows – white ellipses in Figure 2, neckline – white downward-sloping trendline).

Figure 2. TRV Daily Chart

Implications

  • The stock is expected to exhibit more bullish momentum after breaking above the red trendline. A move back above the $133 level (orange horizontal line in Figure 1) will strengthen the bullish thesis.
  • The inverse H&S pattern has a minimum upside target of $139 (white vertical line in Figure 2).

Outlook

  • Moderately bullish in the $125 (2018 low) – $133 range.
  • Outright bullish above $133
  • Potentially bearish if the low of the bottoming formation is broken to the downside (i.e. below $125).

Trade Recommendation

  • Buy half a position at current levels ($131.32 at EOD on Friday, June 8). Other half upon a close above $133.
  • Target: Half at $139 (upon a retest of the green trendline in Figure 1 from below & target from the inverse H&S). Half at $143 (yellow horizontal trendline in Figure 1).
  • Stop: Half upon a close below $127.50 (below bright blue horizontal trendline in Figure 2). Half upon a close below $125.

Disclosure: No position, may initiate a long position next week.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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    4.3 stars on average, based on 16 rated postshttp://www.linkedin.com/in/konstantindimov




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    Trade Recommendation: Dash

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    Dash (DASH/USD) appears to be in a freefall. It dropped to as low as $57 on December 6, 2018. At that price, the market was down by over 95% from the 2018 high of $1,400. On the surface, this cryptocurrency looks like it is ready to die. A closer look, however, shows us that Dash is ready to be reborn.

    Technical analysis shows that Dash may have bottomed out on December 6. We have several reasons to support this view.

    First, we look at the volume of the weeks leading to the drop of $56.

    On the week of November 19, Dash printed volume that’s over 174% of its weekly average. More importantly, the volume buzz was the largest that this coin printed since April 2017. Then a couple of weeks later, the market generated volume that’s over 188% of the weekly average. It was also greater than the volume buzz of the week of November 19. All in all, the combined volume of those two weeks screams capitulation.

    On top of that, the move down to $56 completed the market cycle. Dash has given up all the gains it made last year. With a clean slate, the smart money can start accumulating at current levels. It looks like they’re already doing that. The sudden volume uptick on December 7 is a  clue that someone is buying in bulk.

    The strategy is to buy as close to $56 as possible. It is very likely that the market will revisit that level again soon. If bulls stay above it, then we might see a quick rally to our target of $86.50.

    The process may take a month.

    Daily Chart of Dash/US Dollar on Kraken

    As of this writing, the Dash/US Dollar pair is trading at $70.45 on Kraken.

    Summary of Strategy

    Buy: As close to $56 as possible.

    Target: $86.50

    Stop: $53.50

     

    Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

    Featured image courtesy of Shutterstock.

    Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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    3.8 stars on average, based on 286 rated postsKiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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    Trade Recommendation: TRON

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    TRON (TRX/BTC) is one of the few coins that have remained stable in spite of the massive November selloff. While bears worked hard to push the market below the yearly low of 0.00000259, bulls fought back and managed to lift the market above 0.000003. This happened twice: when the market dropped to 0.00000273 on September 12 and on November 20 when it touched 0.00000284.

    As a result, the market moved back and forth between 0.000003 and 0.000004 for months. Recently, however, TRX/BTC has been showing signals that it is ready to break out of the range. This gives us a very good opportunity to anticipate the breach of the range high.

    Technical analysis shows TRX/BTC is poised to break out of a triple bottom pattern and launch a bull run. We have several reasons to support this view.

    First, even though the market has been trading within a range, a closer look at the 12-hour chart reveals that it has also printed a higher high of 0.00000429 on October 8 and higher low of 0.00000284 on November 20. At the very least, this tells us that bulls are expanding their territory.

    In addition, we can see the 200 moving average crawling below the 12H candles. The flip from resistance to support of this indicator is bullish. The 200 MA now acts as a support on the 12H chart that can help TRX/BTC take out the range high.

    The strategy is to wait for the market to breakout and retest 0.000004. This bear market has been notoriously setting up bull traps. Many coins have broken out of the range high with heavy volume only to find themselves back to support. Thus, it would be best to buy the retest of the breakout to be on the safe side.

    If the market follows the script, the target is 0.00000523. The process may take less than a month.

    12-Hour Chart of TRON/Bitcoin on Binance

    As of this writing, the TRON/Bitcoin pair is trading at 0.00000382 on Binance.

    Summary of Strategy

    Buy: Retest of 0.000004 after the breakout.

    Target: 0.00000523

    Stop: 0.00000386 after the breakout.

     

    Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

    Featured image courtesy of Shutterstock.

    Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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    1 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 5 (1 votes, average: 5.00 out of 5)
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    3.8 stars on average, based on 286 rated postsKiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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    Trade Recommendation: Ripple

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    Ripple (XRP/BTC) is one of the few altcoins that have stood strong in the height of the bear market. It climbed as high as 0.00010523 on November 20, 2018, after dropping to as low as 0.00006077 on October 12, 2018. While almost every crypto was plummeting, XRP grew by over 73% in a little over a month.

    At that price point, however, Ripple had to correct. It was overbought on the 4-hour chart. In addition, a large bearish divergence was seen on the 4H RSI. With signs of bullish exhaustion, Ripple pulled back. Nevertheless, this retracement gives us a chance to buy the resumption of the uptrend.

    Technical analysis shows XRP/BTC breached resistance of 0.000089 today, December 8, 2018. The price action triggered the break out from the falling wedge on the on the 4H chart. With the move above the resistance, Ripple climbed as high as 0.000093 today.

    As of this writing, Ripple is retesting the breakout. It appears that bulls are ready to put up a fight. Fortunately, technical indicators are working in their favor.

    The lower timeframe RSIs are close to oversold conditions. Also, volume is starting to pick up. This is a sign that buyers are stepping in. More importantly, the 200-day moving average is crawling below the 4H candle. It will act as a support that will help keep Ripple’s uptrend alive.

    The strategy is to buy the retest of the breakout as close to 0.000089. If bulls defend this level, they will likely spark a rally to our target of 0.000115.

    The process may take a month.

    Daily Chart of Ripple/Bitcoin on Binance

    As of this writing, the Ripple/Bitcoin pair is trading at 0.00008912 on Binance.

    Summary of Strategy

    Buy: As close to 0.000089 as possible.

    Target: 0.000115

    Stop: 0.00008626

     

    Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

    Featured image courtesy of Shutterstock.

    Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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    Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
    2 votes, average: 5.00 out of 52 votes, average: 5.00 out of 52 votes, average: 5.00 out of 52 votes, average: 5.00 out of 52 votes, average: 5.00 out of 5 (2 votes, average: 5.00 out of 5)
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    3.8 stars on average, based on 286 rated postsKiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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