My Trade Plan:

  • Stop:  Under $179 at the lower end of the range and near the lows we saw back in July/August last year
  • Target 1: $200
  • Target 2: $215

My Trade:

  • Strike: 190 calls
  • Expiration: Jan 21 2022
  • Price: near $5.00

 

ETSY, Inc. (ETSY) - Bullseye Pick of the Week

ETSY, Inc.   (ETSY)

Original Alert went out on January 10, 2022

I like to look at indicators like Keltner channels and the “average true range” (ATR) of a stock to get a sense of where the stock is most likely to trade in the future. 

ETSY (along with tons of other stocks in the market right now) are trading at -3 ATR which is very uncommon.  

Could these stocks go lower from here?  Certainly.  Is it likely? Not based on historical volatility data.  

That is where I place my bets.

While the chart on ETSY might look ugly right now, I think that is the exact time you want to look for an opportunity for a relief rally that could move the stock 5-10% higher.  

I am not calling for the market to run into full bull mode anytime soon, but I definitely think we are very close to finding that relief rally where shorts will be forced to cover their shares and bullish traders resume buying the dip.  

I think this will be short-lived however and I don’t want to be in trades very long right now

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