GS – Goldman Sachs (Last:137.04)

goldman-would-be-a-good-betA close above 142.32 would shorten the odds of a finishing stroke to at least 150.72. Both numbers — respectively, a Hidden Pivot midpoint pivot and a ‘D’ rally target —  occur in the pattern shown in the accompanying chart. Ordinarily I would suggest laying in some calendar spreads at the 150 strike to play this move, but the spreads are quite pricey and would need to be legged on to make the strategy worth our while. The July 150-June 150 spread is trading for around 2.70, but we’ll try to get in for half that price by buying the October call on a dip. If there is no dip, we’ll simply have to forgo the trade. For starters, buy four July 150 calls if the stock touches 131.14 a dive.  There is nothing to suggest we will see such weakness today, but if it should occur, that’s where the stock would head.  It is a Hidden Pivot support that comes from the 15-minute chart. I estimate that the calls would be a good buy for 3.00 with the stock trading down near the target, so if you want to leave a limit order with your broker, you can do so without fear of being ripped off. Make it a day order.