Old Copper Co. Inc. (f/k/a CPPRQ/JCPNQ JC Penney)

[ITMS]

Here Is A Classic High Reward, Low Risk Trade On J C Penny

Shares of J C Penney Company Inc (NYSE:JCP) continue to decline, now down from $4.75 in late February to nearly $3.00 in mid-March. There is a low risk, high reward trade setup I am watching. First, note the major support level at $2.75 (see in the chart below). That is the buy level. But to complete this trade, you want to know that you are risking a minimal amount for a large reward. First, the upside could be huge. Just two weeks ago, J C Penney was trading at $4.75. A swing trader that buys at $2.75 can make 73% if it just trades back to those highs. The next setup is to look at the risk. The 52 week/multi-year low on J C Penney is $2.35. As a swing trader, that would become your stop (a daily close below $2.35). This means that you are risking under 15% for a likely reward of 73% and buying off a major technical chart support level. To me, this is a trade worth taking. I will continue to watch as J C Penney approaches the buy level.




Gareth Soloway
InTheMoneyStocks