SBUX

SBUX price has pullbacked for the last three days. Today there is news that Bernstein initiated coverage for SBUX with Outperform rating and $25 target price.

The chart below was taken about 70 minutes after market opened today.



SBUX price may found support on MA 50 days and 23.6% fibonacci retracement.
We can enter long position (buy stock or call option) at near market close today if the candlestick still show strength from buyer (price does not go below yesterday close)

List of options as below


We can choose to buy Oct 09 20 Call or Nov 09 20 call. For bigger delta we can choose strike 19. Personally I will choose Oct 09 20 call for cheaper price, so the risk:reward will be better. The position should be held until the profit target is reached or stop loss is hit. The profit target and stop loss should be adjusted to your risk profile. Do not use more than 5% of your total capital for each position. So if this position is 100% loss, your capital will be reduced only 5%. If you set stop loss at 50%, your capital will be reduced only by 2.5% (5%X50%). There will be still enough capital for you to stay in the trading game and you can sleep well knowing the risk is so small. I welcome any comments from visitors of my blogs.

Best regards

Snip