American Express - AXP - close: 44.98 change: +0.68

Stop Loss: 41.49
Target(s): 47.50, 49.85
Current Option Gain/Loss: unopened
Time Frame: 10 to 12 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
The rebound in financials is very encouraging. Dow Theory suggests that we can't have a sustained rally without the banks. AXP has been showing some strength the last three or four days. Plus, the stock has built an inverse head-and-shoulders pattern that is forecasting a move toward $50.00. I'm suggesting we launch bullish positions on a dip at $43.50. If triggered we'll use a stop loss at $41.49, under the 200-dma. We will plan on taking profits at $47.50 and at $49.85. Our time frame is several weeks.

Trigger @ $43.50 Suggested Position: Buy AXP stock at $43.50

- or -

Buy the 2011 April $45 calls (AXP1116D45)

Annotated chart:

Entry on December xx at $xx.xx
Earnings Date 01/20/11 (unconfirmed)
Average Daily Volume: 9.0 million
Listed on December 2nd, 2010