Stalking Visa and MasterCard for an Entry

 | Apr 05, 2013 | 7:45 AM EDT  | Comments
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ma

The charts in Visa (V) and MasterCard (MA) are similar on both the weekly and daily charts, as they are both in very strong positions. Price is clearly above both the 200- and 50-day simple moving averages. The pattern is still clearly a bullish one of higher highs and higher lows.

So now that we are seeing some nice pullbacks in these two, I'm interested in buying the pullback. I'm interested in Visa on the buy side as long as the decline terminates somewhere above the March 19 swing low. I'm interested in MasterCard on the buy side, as long as the decline terminates above its March 19 low. Let's take a look at the zones that we may consider a buy entry against that come in above this prior key low.

Starting with a daily chart of Visa, I have two price support zones that stand out above the March 19 low. They come in at $163.82-$164.89 and then $161.27-$163.11. So far, price is holding above the first zone, with the low being made at $164.28. So far I'm only seeing some day-trade triggers against this zone, using a five-minute chart.

If price continues to hold above this low, I can tell you now that the first target for a rally off it comes in at $172.82. The second target is at $175.14. But if a new low is made, the target will be adjusted by simply running the 1.272 extension of the swing into the zone.

Again, I am only interested in the buy side if one of these two zones is not violated!

 

V Daily
DynamicTrader

 

Now let's take a look at the daily chart of MasterCard. This one has not actually tested the support just yet. There are actually three zones I'm stalking in MasterCard, though I lean toward liking the middle zone the best. That does not mean we will get there, though! The reason I prefer it is that when a .618 retracement overlaps symmetry projections, it is a pretty good trend trade setup.

The MasterCard zones are $526.25-$529.40, $522.59-$524.61 and $518.35-$519.91. In stalking an entry here, I want to see one of these zones tested and for it to hold. I will usually give it $0.50 cents, plus or minus the zone, though many times we will get an exact test somewhere within the Fibonacci price cluster. If we hold above the recent lows, the upside target in MasterCard comes in at the $551 area. This target will be adjusted, however, if we test one of the lower zones instead.

Bottom line, I like the buy side of these two stocks if we can hold above the March 19 lows and see our buy triggers.

For more info on triggers, please click here.

 

MA Daily
Dynamic Trader

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