SIRI Stocks Trade Idea
This week, Trade Ideas technology is signaling that a once high flying technology stock, which has been mired in a very long bottoming base, is showing some signs of life. SIRI reporting earnings on 3/26 and the following day had an impressive gap-n-go breakout, accompanied by over 3 time’s normal option volume. It is now trading at an 11 year high, and has finally comfortably cleared the very important $5.00 level.
The Trade of the Week in SIRI is live at the market open on Monday 7/31.
This can be setting up for a go-pause-go pattern, and a breach of the 2-day high could cause the roughly 18% of the shares in the float who are short, to rush to cover. There is now a very strong support level at $5.50, but giving some wiggle-room, we will use a break of $5.45 as the stop. We always say targets are subjective, so we are calling for a 3 to 1 reward/risk ratio. With that ratio, our target will be set at $6.92
Footnote: This is a table showing the maximum profit for all past 2017 Trades of the Week. Timing the top is impossible but this table shows how much alpha was possible when considering the exit of these positions. The trades outlined in red eventually hit their suggested stop prices, so you can see the importance of timing and harvesting profits along the way when you can, especially those that move above 10%.
Trades of the week that do not reach entry prices are not considered live and are expired at the end of the current week. (ORCL and JNPR)