***New Position: K: Long 67.64 ATR: 1.27
Name of Instrument: Kellogg Co.
Current Price: 67.62
Sell Stop: 65.19
Reason For Trade: Those of you who are new to the service, I featured Kellogg as a top pick for a long. At the time, I told attendees that I wanted to see K clear the 50 DMA. So true, I bought ahead of that in anticipation that it could clear because the slope on the overhead 50 DMA is inclining. Using the law of attraction to major moving averages theory, that gives this a high probability that it will reach and hopefully breach the 50 DMA. On the weekly charts, I used the 65-week moving average to determine our risk. That also breaks the 200 DMA should this fail. With a 2 ATR of risk, we are giving the trade room to mature, however, I will move the stop up under the 100 DMA (now at 67.06) well ahead of our stop if K cannot get going. The all-time high in K is 72.34 made on October 22nd. It declined after reporting the 3rd quarter earnings results. If you are an active trader, if K can close over 70.00 the odds increase exponentially that it can make new highs with an overall target of close to $80.00
First Profit Target: We will have 2 ATRs if it gets to 70.00 and will go to a no loss stop then. At 3 ATRs or 71.24, we will take off ½
