Trade Ideas Newsletter 08/25/2016

SPLS is at the beginning of a significant breakdown

Based on the previous analysis in SPLS, traders should ensure that their portfolio can handle increased risk from an additional trade. Also check to make sure that SPLS increases diversification of your current portfolio. Lastly, smart traders check how a new position relates to not just their account, but the current market action as well. For example, take a look at the S&P 500. Is it moving higher or lower? Has it recently moved through a key resistance or support level? Be sure to match up your trading actions on SPLS in relation to the overall market movement.

CHART

Right now the custom sentiment levels, measured by Traders For Wealth, indicate an increasingly negative bias toward SPLS. In addition, the price action in SPLS has been moving down as well. This could be a strong sign of an impending breakdown. Traders should view this as a very bearish trade and make sure it matches up with the overall market, and their current portfolio.

Staples (SPLS)

Staples, Inc. is a provider of products and services for business customers and consumers. The Company offers a selection of products, Websites and mobile platforms, and a range of copy, print and technology services. The Company operates through three business segments, which include North American Stores & Online, North American Commercial and International Operations. The North American Stores & Online segment includes its retail stores and Staples.com businesses in the United States and Canada. The North American Commercial segment consists of the United States and Canadian businesses that sell and deliver products and services directly to businesses, including Staples Advantage and Quill.com. The International Operations segment consists of businesses in approximately 25 countries in Europe, Australia, South America and Asia. It serves businesses of all sizes and consumers in North America, Europe, Australia, South America and Asia.