Start with the trend, because if the trend is wrong, nothing else matters. SCHD closed at $32.53, sitting right up near its highs after climbing all year in a steady staircase, higher highs and higher lows. Even if you had never looked at a chart before in your life, you would glance at this one and know instantly it is heading up and to the right. That is a strong trend, plain and simple. Then the pattern, and this is where I lean in. Look at the moving averages. The 8-day sits on top, the 21-day right beneath it, the 34-day beneath that, all of them rising, with price riding above the whole stack. And it is doing this on both the daily and the weekly chart. Here is why that matters. When the averages line up in that order, the trader who bought last week, the one who bought last month, and the one who bought months ago are all sitting in the green together. Nobody is trapped overhead waiting to dump shares into the first sign of strength. When two timeframes point in the same direction like that, it is far stronger than one, and right now the buyers clearly own this thing. Last is the squeeze, and that is the part that got me to write this up. A squeeze is what happens when a stock stops making big moves and cools into a tighter and tighter range. Picture a spring being slowly compressed. The volatility winds down, the range pinches in, and all that energy gets stored with nowhere to go yet. The longer it coils, the harder it tends to pop when it finally releases. On SCHD, that squeeze is on right now. And here is what makes it the good kind. It is coiling right up near the highs, not down in the gutter after a beating. A spring loading up at the top of a strong uptrend is the most bullish place it can be, because the path of least resistance is already up, and the coil is just packing more fuel in that same direction. Trend, pattern, and squeeze, all lined up on the same chart. That is the setup I go hunting for every single week. There is one more thing I like here. Because SCHD is a quiet, steady fund and not some wild momentum name, its options are cheap. You can go out several months without paying a heavy premium. Your Action Plan So here is where it stands. SCHD is on my watchlist for its clean setup. But this is just one name I am tracking this week. If you want to see what trading on the other end of the speed spectrum looks like, there is a new initiative worth a look. It’s a way to target fast, defined moves, with example wins like $10,000 in 6 minutes, $20,650 in 12 minutes, and $21,700 in 11 minutes, and never once by betting on a falling stock. The next one is coming between now and Monday. Get access to the next Fast Cash trade here. |
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