MSFT current trading range 26.26 to 27.73.
The trading range play is buy near 26.26, if it falls below 26.26 bail out. A TA short signal would be generated, go SHORT.
Sell when it nears 27.73 and that would conclude the current trading range play.
of course if goes over 27.73 a TA long signal would be generated, BUY.
So, as any lame brain can see buying now, immediately, at 26.46 would represent little downside risk, just set your stop at 26.25, possible loss .20.
The upside on the other hand represents a possible gain of 1.47.
YOU PEOPLE CAN'T "PLAY".
MSFT nearing top of Trading Range 27.73 and since I'm the only one here with enough brains to actually trade MSFT and make money I will commit and post what to do tomorrow, SELL MSFT before tomorrows close and take profit from the last long in the 26.40's and do not hold through earnings.
MSFT may trade up after reporting and then again it may trade down, the point being a trader is at the complete mercy of the market at earnings and even you should know that's not a good place to be.
I happy with 1 point a week off MSFT, 52 weeks in a year playing 1k shares makes 52 thousand a year or double your money at todays price.
TRADERS track the DOW first, then the stocks, I can out up a mere $5k and play 5 eMINI contracts, for each point the DOW moves my way I make $5 per contract, if I play 5 contracts it's $25 a point. DOW goes up 100 points I make $2500 playing 5 contracts and I've made that amount in just a few minutes many times. Completely liquid, buy one second and sell the next is OK, and I'm all cash a EOD so I can sleep well.
Of course I'm logged into 1 futures daytrading chat room and 2 stock daytrading chatrooms from open to close.
Well sure, if you have the capital to make big plays, then you don't need options. I like options though because it multiplies the price moves by a factor of 4 or 5. I can trade $50,000 of microsoft spreads and make $2000 profit in one day on a $0.25 move in the stock price. If I were just trading the common, it would be more like $500 profit.
I didn't post options because I have more control playing the stock and it's a WINNER, OVER AND OVER, I recall MSFT trading 130 to 140 range for over 6 months back in 98 or so, I must have made over 200 points!
I do play YM, eMINI DOW for fast action, I'm talking second to second action.
making $1.47 having $26+ at risk is *ok*...that is a return of 5% to 6%.
Buying the Jan 2014 $23 call for $4.20 and Selling the Oct $27 call for $1.62 is a much better play on the microsoft trading range though. The potential profit is at least 55% and you get that profit even if Microsoft stagnates in the $26 range (it is very good at doing that!). You don't even start to lose money until Microsoft falls to $25.50, and even then you have another Christmas and Xbox 720 to recover on your Jan 2014 call.
I pitty the fool who paid more than 28 for MSFT. Insiders are cashing in their $25 options and selling at 26-27. They're the only MSFT traders making money these days. You'll have to wait in line behind them to sell your shares if you paid more than 28.
Sentiment: Strong Sell
As you can see the 1st MS Trading Range Play posted Dec 31 was successful with the opportunity to make 1.27 points long, and about the same profit if shorted at top of trading range for a grand total of 2.54 points, and here it is again, immediately, thqt means right now.
MSFT current trading range as of jan 8 at time of this post 11:59am is 26.26 to 27.73 now trading in realtime 26.48. That's near bottom of trading range.
Remember, YOU CAN'T PLAY! But I can.