Bearish Chaikin Signal On Monsanto

 As underlying market fundamentals continue to show weakness, we trade where and when we can.   

Today Chaikin Analytics gave a "Reversal Sell" Signal on Monsanto.   Reversal Sells are powerful signals, that I have had a decent amount of success trading them.  

As Monsanto has earnings behind it,the stock  is in a downtrend,  and has very recently become overbought, it is an attractive short candidate.  However there has been a small amount of positive money flow as well as teetering relative strength... currently positive.     While not a "slam dunk" short set up, there is enough to peek my interest.    

With 38 days until expiration I looked at trading the 95/97.5 bear call spread.   The spread has a  66% chance of expiring worthless at expiration.   The spread pays .75 cents per contract,  which leaves 1.75 in risk per contract.  or, 42% return on 34% risk.    

While  not the best set up I've ever seen,   but combined with the marco market fundamentals and sentiment...It's good enough for me.   I will look to close this trade at 50% max profit, or about .38 cents,  OR  will also watch for this trade to against me.  If the spread trades 1.50 or higher I will look to exit the trade for a loss, lick my wounds and move on.  

I'll will update you on my exit 

Happy trading

AA