INTC long term view supports short term trading plan

As long as the recession continues to simultaneously get worse and show signs of improvement, it is likely that a major flight to quality will ensue in the market. Leaders that are providing positive - like Intel- will especially enjoy the favor of the masses.

From INTC long term view / short term trading plan

Take a look at the 5 year weekly chart shown above. Note the following:
• Tested, long term support levels at $17 & $20 were both definitively broken during the one catastrophic month: Sept 2008

From INTC long term view / short term trading plan

Now, in the same 5 year weekly chart shown above, notice the crucial role $19 has played as a support/resistance point whenever INTC has traded in the $17-20 range

From INTC long term view / short term trading plan

Let's zoom in a little to the 1 year weekly chart now, keeping an eye on the same 3 price levels: $17, 19 & 20: $17 resistance was broken on massive volume in July
• Base built around $19 as prices oscillated for next 5 weeks
• Then, $20 resistance was penetrated, but only on moderate volume.
• Subsequent failure to stay above $20 was on even less volume, however, and did not breach $19 support.

From INTC long term view / short term trading plan

With all of this in mind, one look at the 50 day daily chart yields a nice trade set up.

Key points:
• Failure to stay above $20 was on weak volume
• Stronger base is well-established at ~$19
• Next lower long term support is at $17.
• However, this was broken on massive volume as INTC gapped up ~$1 to >$18.
Trading plan:
• Accumulate shares at or around $19
• Sell half at $20 if failure to break through or insufficient volume.
• Repeat above 2 steps as many times as possible, but always hold half in case of major upside break
• Stop loss just below $18 (don't get caught falling back through the gap.)