On November 11, 2010 Cisco gaped down from $24.50 to $20.25 overnight after it announced its quarterly earnings. It climbed up to $22.05 by February 9, 2011 and gaped down again next day to $18.86 after it released its earnings. Since then this stock has been down trending and traded to its 52 week low of $16.52 on April 19, 2011.
Currently it is trading at $17.52 way below its 200 moving average and with last four positive days, I think it’s about to swing to uptrend. If it does start an uptrend I want to be ready to make money, so here is my plan.
I will be setting up a buy stop order to buy 400 shares of CSCO just above resistance 1 at $18.33. Once the purchase is complete I will be setting up a sell stop to sell all 400 shares at $18.03, just below the same resistance line, which will eventually become its support line.
Please note that Cisco will be releasing it’s quarterly earnings on May 11, 2011, so just be careful around this date. I will be updating this post as I buy or sell this stock, so please bookmark this post and keep visiting daily.
