Using Top Down Analysis, Material sector appeared as the top sector followed by Diversified Chemicals Industry. EMN.N came up as a potential stock to take a Long position

Weekly backdrop was neutral and daily chart was supported by Memory support line

Cue Vital shows that its under valued and it has increasing Quarterly Earnings

A Long position can be taken if its opening price breaks above last closing price and stop loss can be placed below memory support line.

Partial profit taking (2/3) can be taken at Upper boundary line.

EMN.N Sector 1.png  EMN.N Industry 1.png 
EMN.N Vital 1.png 

EMN.N Chart.png 
$EMN went up and closed the day with a bullish shape candle after Subbie shared the idea.

Here is my comment on the analysis.

1) It was a perfect example of the compelling top-down analysis: a robust sector, a healthy industry, strong fundamentals. 

2) On the technical side, the stock was near the lower edge of a sideways range. That calls for a sideways trade setup - not a trend-following GWF setup. Anyway, the GWF setup did not meet the checklist conditions as the weekly Backdrop was not cyan. Was there any Box setup? No - there was no Stretch Release. Any Headwind? No, there was no Headwind signal. Therefore, there was no CUE trade setup on the analysis day.

Could one buy the stock without a valid trade setup? The answer is yes. But that question and answer are misleading. The real question is different. That is: 'why would one buy a stock that is not meeting one's plan i.e. trade setup'? I leave the answer to the trader herself/himself.

3) If one was looking to take a sideways market trade, then the opportune moment was five days ago when the Stretch Release signal came. 

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Disclaimer: This site is for educational purposes only, explaining the use of CUE systems and techniques. It is not for trade advice. Trading involves risk. You and only you are solely responsible for the outcome of your trades.

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