First up is fast food behemoth McDonald's (MCD), a stock that's been getting shoved lower despite its positioning as a defensive name. Back in 2008, deteriorating economic conditions were a sales catalyst for McDonald's. In 2012, they've only helped to push shares 12% lower from the first trading day of January -- but that performance could be about to change.
Right now, McDonald's is forming a symmetrical triangle, a pattern that's formed by converging trend lines. The trading signal comes when MCD breaks through one of those trend lines, so if MCD pops above the upper trend line, traders have a buy signal. The symmetrical triangle is also sometimes called a coil because of the volatility properties it has; as the coil progresses, price action is getting constrained in a smaller range, and volatility is declining. Since volatility is cyclical, symmetrical triangles often get exited with big moves -- a good thing for traders looking for confirmation before buying.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV