The NYSE Euronext equity issue is currently supported by a 78.6% retracement value located at $20.14. The 5 sequence wave pattern can be identified on a daily timeframe consisting of 37 days. When we apply a standard deviation of +/-1.618 to the closing price of these 37 days, it can be identified that the negative deviation results in a price support level of $20.31. Since NYX is residing at its lower deviation, call options with relatively high deltas are priced very cheap. The 2 main targets for upside potential consist of $34.32 or $40.01. The minimum target should be met with considerable ease if NYX can remain above its last major inflection point of $16.33. This does not imply that a sell stop should be placed below that low, but consider that the support level I mentioned earlier has been successfully tested twice already. There is a possibility that this level may not hold again if tested so adjust your stop loss to the 78.6% support rather than the ultimate low.
Wednesday, January 21, 2009
NYSE Euronext
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The NYSE Euronext equity issue is currently supported by a 78.6% retracement value located at $20.14. The 5 sequence wave pattern can be identified on a daily timeframe consisting of 37 days. When we apply a standard deviation of +/-1.618 to the closing price of these 37 days, it can be identified that the negative deviation results in a price support level of $20.31. Since NYX is residing at its lower deviation, call options with relatively high deltas are priced very cheap. The 2 main targets for upside potential consist of $34.32 or $40.01. The minimum target should be met with considerable ease if NYX can remain above its last major inflection point of $16.33. This does not imply that a sell stop should be placed below that low, but consider that the support level I mentioned earlier has been successfully tested twice already. There is a possibility that this level may not hold again if tested so adjust your stop loss to the 78.6% support rather than the ultimate low.
The NYSE Euronext equity issue is currently supported by a 78.6% retracement value located at $20.14. The 5 sequence wave pattern can be identified on a daily timeframe consisting of 37 days. When we apply a standard deviation of +/-1.618 to the closing price of these 37 days, it can be identified that the negative deviation results in a price support level of $20.31. Since NYX is residing at its lower deviation, call options with relatively high deltas are priced very cheap. The 2 main targets for upside potential consist of $34.32 or $40.01. The minimum target should be met with considerable ease if NYX can remain above its last major inflection point of $16.33. This does not imply that a sell stop should be placed below that low, but consider that the support level I mentioned earlier has been successfully tested twice already. There is a possibility that this level may not hold again if tested so adjust your stop loss to the 78.6% support rather than the ultimate low.
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