Here’s a quick view of Transocean (RIG)…which is a trade that I’ll be explaining tonight. (April 17, 2018)
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Just a quick video today on RIG, on Transocean ( NYSE: RIG ). One of the reasons why I picked this to do is because this was a stock that I picked up on my scanner several days ago and it is up big-time since then. We have had a trade on it over at Option Market Mentor for quite a while. It was an option trade; bought the stock, sold the calls, sold the puts and then bought some more stock. For a covered call trade, it is up 15 percent, which might not sound like very much to you if you are one of these fast “shake ‘em up” traders. But 15 percent on a covered call trade is totally safe; I will take that all day long.
So what do we do with RIG ( NYSE: RIG )? The company reports earnings at 4/30, that is still in a couple of weeks. You look at the weekly chart here and you can see the stock is right up at the top of the range. I would just put it this way: If Transocean ( NYSE: RIG ) moves up to 12.40 that is when I would consider selling the stock because it will be right up around resistance, right up here, so it is very close. But the thing is, the stock has some pretty good momentum.
So what you want to be doing is, look at volume. Volume definitely needs to be staying above the blue line here. This is the 20-day simple moving average of volume and so you can see where this stock took off; right here. And so you stay long RIG ( NYSE: RIG ). Note that, I think this was the last lower intraday low that we had clear back on April 6th. Since that time every single day, they’re all open bars too, but every single day has been a higher low. That means that the buyers are actually getting more and more determined. They are not even letting the stock come down to the prior day’s low before they are taking stock.
That is something that I want you to keep in mind. Stay long RIG ( NYSE: RIG ). Frankly, I am not really sure that I would buy it here, I probably wouldn’t just because of the analysis that I just gave you; where if it gets up to 12.40, maybe 12.50, that is when I would be looking to take profits. So would you really want to take somebody like me out of my trade for a nice profit and you just get the scraps here? Not a good deal. But if you are already long this stock I would stay long a little bit longer. Based on what I just said as far as intraday lows, 11.67 is today’s intraday low, you could put your stop right now at 11.65. Put your stop at 11.65; the only way you are going to get stopped out is if this series of higher intraday lows breaks down; that’s when you want to be out of the stock anyway.
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