Wednesday, October 23, 2013

Wed-nes-day afternoon


S&P futures are running the meat grinder pattern today. 

Wednesday morning

DIS Daily Chart
There was discussion on the blog about DIS while the government employees were on "vacation" back around 10/3.  It was suggested that the 50 day sma would be a good place to look for support and if it failed to hold then the position should be stopped out.  Well, that trade would have ended with a small loss on 10/9. That day the stock tested Carter Worth's "smoothing mechanism" (aka the 150 day sma) and bounced nicely while printing a buy signal with the stochastic.  If the trade were re-entered (or a core position held) there are some juicy profits to take.

The stock is now in overbought territory so it may be wise to close the position or at least tighten a trailing stop just under the horizontal support line.  After this strong move from 63 to 69 it seems likely a pullback is in order.  (I have no position.)