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. Kimberly-Clark Corp., KMB Stock, is in focus today…

This journal entry looks at the recent market movements of Kimberly-Clark NYSE: KMB Stock

VantagePoint Trading Journal KMB Stock

Italy’s anti-establishment parties have abandoned plans to form a coalition government after the country’s president refused to accept a controversial choice for the economy minister, raising the possibility of snap polls. Investors fear the election will resemble a referendum on the EU and the euro, posing an existential threat for the bloc.

*Source:  Seeking Alpha

This is a seemingly minor story on an otherwise blah day.  The early trade markets are down a bit, but I am still willing to consider strong indications of bullish momentum.

Let’s consider Kimberly Clark Corp (ticker: KMB today):

The VantagePoint platform recently indicated a potential continuation of 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 5/24/18 and 5/25/18.  We can combine that with the VantagePoint propriety neural index indicator moving from the RED to the GREEN position on 5/24/18.  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. Additionally, we see that the predicted high and low for today’s range is above the actual high/low.  I want to play the VP bullish indication.

Strategy Discussion

If one were a straight stock trader, simply buying KMB in the $105.50 area could prove to be prudent. You are anticipating a move to the upside. It’s also a conservative way to enter KMB without the limitation of time associated with other strategies. It would also be good practice to place a sell-stop order in the $104.00 area to mitigate potential losses.

For more active traders with a shorter investment time horizon, you can consider a setup utilizing options. Given the market conditions outlined above, taking a passive, premium credit approach may be the best path to success.

Because of the reasons given above, the sale of a credit put spread may be one way to approach this situation.  You want to collect as much premium as possible while keeping your risk parameters in check.  You may consider selling the June 8th weekly expiration, 104/105 put spread for $0.45.  The maximum reward is the amount of premium you collect and the maximum risk is the width of the spread less any premium collected.  In this case, maximum reward is $0.45 and maximum risk is $0.55.  You are laying odds of 1.22:1.

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 1-3 days in advance with up to 86% 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.