Hey everyone, Robert Roy, founder of WealthBuildersHQ.com. Welcome to this edition of Trade With Rob which is for May 26, 2021. Now, the markets just closed up just a few minutes ago, so let’s go take a look at the S&P 500, and see what we can come up with.

Those of you who are new, welcome, if this is your first one. We have this really nice move up, we pressed up into the upper level of the zero-line, we played over and over again on this black line, which is 4181. We hit all-time highs and closing highs, which are these two blue line that are in there. We pushed up yesterday again 4181, 4191, 4200 on the wick, and today we came back to…go figure…4181, the horizontal black line yet again. Driving me NUTS that we can’t seem to get away from there, but not surprising.

So with that being said, let’s go ahead and take a look at our candidate for today, and that is LMND, so let’s go back and take a look at it.

So the very first thing is, LMND is a fairly new stock in comparison to an AAPL and the like. It started trading back in July of 2020, so it’s less than a year old. They’re optionable. It’s got some decent options on them. They’re not “oh my God, they’re fantastic,” they’re not AAPL options, but they’re still not bad in the overall scheme of things.

So, what happened today? First off, let’s identify our Fib. V-top, very nice thrusting pattern, back up to the .236 hesitation point (with a confluence at the 100 level), and we failed, came back into the zero-line again, came back to the zero-line again – a little head-fake two days in a row – went back up, great channel. Came back down, finally broke, good zero-line breakout entry right there, exit 2 taken right there. And then what? We kind of gained back up, and today was actually a great day.

Had we seen this yesterday (which I did not), it would’ve been a great opportunity to take a trade. Since I did not, what do we need to have happen at this point for this to be a really viable trade? I need this to come up and retest this 80 level and fail. That could be one day, two days, closes near it, the next day it fails; that’s your risk profile to determine that.

Once in that trade, our stop would be 82 if it goes against us. If we are right, our first target, T1, is 74.50. Exit half of your trade. If you only have one contract, exit the whole thing at 74.50. If you trade 2, move your stop down to at least breakeven, possibly a little better than that. Target 2 is down here at 68.50. So, we’ve got a lot of opportunity considering we’re looking for to bounce at 80 and looking to get out at, we’ll call it, 69. That’s a $10-$11 move on our position.

 

 

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