VantagePoint Trading Software is a forecasting tool that uses both end of day data and Artificial Intelligence to provide traders a forecast of market movement. These forecasts are 1-3 days in advance and help traders improve their timing on making trades and maximizing profit potential. The Artificial Intelligence software forecasts market movement for stocks, futures, Forex, ETFs and Cryptocurrencies. Wells Fargo, WFC Stock, is in focus today…
This journal entry looks at the recent market movements of Wells Fargo & Company, NYSE: WFC Stock
VantagePoint Trading Journal WFC Stock
The spotlight will be on Fed Chair Jerome Powell this morning as he delivers his semi-annual monetary policy testimony on Capitol Hill. The questioning rarely breaks new ground, typically reviewing the Fed’s recent policy statements and economic forecasts, but some inquiries may revolve around steps the Fed has taken to relax certain financial regulations. Investors are also paying close attention to the discussion on the yield curve – which compares long- and short-term interest rates
@Source: Seeking Alpha
Let’s consider Wells Fargo & Company (ticker: $WFC):
The VantagePoint platform recently indicated upside momentum.
Using the predictive indicators embedded within the VantagePoint platform and its predictive AI technology, we will point out three significant things. We have a bullish crossover indicated by the blue predictive indicator line crossing above the black simple moving average between July 13th to the 16th. We can combine that with the VantagePoint propriety neural index indicator moving from the RED to the GREEN on that same day. This indicator measures strength and weakness for a 48-hour period, in this case strength. The move to the GREEN position further makes the case for a potential bullish scenario. We also have the predicted high and low above yesterday’s actual high and low indicating further strength. I want to play the VP bullish indication.
Strategy Discussion
If one was strictly a stock trader, buying WFC in the $56.50 area could be prudent. You are anticipating a move to the upside. As a protective measure, it is always good practice to place a sell-stop order. In this case, placing that order in the $55.75 area will mitigate potential losses.
For active traders with a shorter investment time horizon, you can consider a setup utilizing options. Given the market conditions outlined above, taking an active, premium debit approach may be the best path to success.
Because of the reasons given above, the purchase of a debit call spread may be one way to approach this situation. The first thing that you want to do is calculate your target price. In order to perform this calculation, you need three pieces of information. This includes the current price, expiration date and the implied volatility for that expiration date. For WFC this calculation yields a target strike of ~$58. You may want to consider the WFC July 27th weekly expiration 57/58 call spread, buying it for $0.35. The most you lose is the premium paid and the most you can gain is the width of the spread less any premium paid. Max risk = $0.35 and max reward = $0.65. This means that you are getting odds of 1.86:1.
Given the trading and market environment outlined above, a trader must evaluate whether this reward/risk ratio is appropriate for his/her risk tolerance.
Use smart software to your advantage
VantagePoint Software uses the power of Artificial Intelligence. This is what traders use to predict market direction and strength. Which is 1-3 days in advance with up to 87.4% accuracy. With deep learning using neural networks, VantagePoint can show you what the market is going to do instead of what it’s already done. Request a personalized demonstration of VantagePoint Software today. Learn why more than 25,000 traders trust the software, which helps them achieve trading success.
