WPL is currently trading at $6.47.
WPL has been trading in an uptrend since its lows in September. This was likely spurred on by rallying oil prices as the northern hemisphere moves into winter. WPL recently pulled back as oil stalled (normal after such a breakneck move higher) and profit taking came in. Crude Oil is showing strength, which we believe will lead to continued buying of WPL. WPL also bounced from both a historic support level at roughly $23.50 and the 200 Day MA. Technical indicators also look bullish.
There is plenty of room to the key resistance at roughly $25.50. There is also a resistance nearby at perhaps $24. Therefore, we suggested a Bull Call spread yesterday to our clients, in case WPL does drift higher. We will start to look at taking profits with a move to $25 or higher, but if it tracks sideward then we can also profit over time.
Today was not a great entry signal, but if tomorrow WPL rises, it may still be worth jumping in.
If you would like to learn how and when to use this strategy, and other strategies like it, then please contact us here at TradersCircle on 03 8080 5788. Alternately, you can download a free eBook off our website which runs through advanced strategies.