• Chart of the Day: Western Digital Corporation (WDC)

    by  • March 27, 2013 2:32 pm • Charts to Watch, Quick Hits, Tony Venosa's Chart of the Day • 0 Comments

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    Today’s chart is of Western Digital Corporation (WDC) which engages in the development, manufacture, and sale of storage products and solutions that enable people to create, manage, experience and preserve digital content.

    Ticker:  Western Digital Corporation (WDC)

    Strategy:  Long Trade

    What I Am Looking At:

    • Excellent outperformance on a year-to-date basis, up nearly 18 percent
    • Recently closed at an all-time high above the round number $50 level
    • Pull back to the 40-day moving average which coincided with a oversold reading on the Relative Strength Index
    • Looking for a move to double the 52-week low at $56.62
    • Peak put open interest for the Aprils series resides at the 48-strike which coincided with the recent pullback
    • The put/call open interest ratio ranks in the 98th percentile of all readings during the past year, and indication of extreme pessimism among option players
    • 11 out of 18 analysts rate the shares a “hold” or worse, potential for future upgrades
    • 3 percent of the float is sold short, potential tailwind from short-covering
    • Quarterly earnings growth (year-over-year) +123 percent and quarterly revenue growth (year-over-year) +92 percent
    • Unconfirmed earnings release April 25th


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    Tony Venosa, CMT is a Senior Options Strategist and works on the trading desk at Schaeffer’s Investment Research. He joined Schaeffer’s in 2010. He has worked in the finance industry for over 15 years. He began his career as a trading assistant in Chicago on the floor of the Chicago Mercantile Exchange. He later moved upstairs and worked as a commodities broker on both the retail and hedging side. He left the brokerage industry to begin his trading career as a proprietary equities trader at a Chicago firm. In 2000, Tony moved backed to his hometown and continued trading his personal account. He later went on to earn his Chartered Market Technician designation. He earned a B.S. in Finance from Miami University. Tony’s main focus is short-term directional option trading.


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