Alexandria Real Estate Inc (ARE)

[iam802]

Continuing my monitoring of ARE.

As of yesterday’s close, there is still no sign that it will continue to be bullish since its last gap down.

It has just rebounded off a support at around 51.78 and it is still too early to tell if it will climb higher. If it fails to climb higher and break through 55.67, we have a lower high and perhaps the a Head and Shoulder formation.

Note:

- Still too early to tell.

- Wait for confirmation

[kennynah]

How r u intending to option trade ARE?

[iam802]

Here's my personal experience with this stock.

1. Shorting it is not a good move because the brokerage may just close your position as the stocks become hard-to-borrow (HTB). I have got it 2 times already and miss out on some major move (only end up with very small gains).

2. This leave us with options.

3. If I am not mistaken, there is a small doji on the chart. This can suggest that buying strengths is weakening (coupled this with the lower Chaikin Money Flow and the previous bearish Tenkan sen-Kijun sen cross).

3. I am thinking of a Vertical Spread (CALL) above $54. If it manage to go higher tonight, maybe a Vertical Spread (Call ).

4. Another thought is to use a Back Ratio?
- However, my worry is government intervention.
- Or it could be too early to use it. After all, there is still a huge kumo support below.

What do you think? Does my thoughts make sense?

[kennynah]

first let's look at the monthly chart... here, i agree with you that there's a doji in sight... and if you look back to Feb09 bar ... you will see a great similarity here... of cos, patterns do not guarantee repetition but all TA practitioners pay attention to them...in a gist, history can repeat...and if it does, then ARE is destined to weakness just like post Feb09...

Then, we look at the daily chart... here, we can see that since Jul09, ARE has been rallying and there's really no technical signal to suggest that this move will end anytime soon... but this is becos i dont use moneyflow indicator ..although the cumulative volume is not encouraging since ARE price moved up from Jul09...

if you turn on your MA50, you will discover that ARE is now sitting right on top of MA50 line... this could be a support...and a bounce could happen....

my resistance reading is ~$61 which is a 38.2% fibo retracement from the low of ~$31...

however, like all trades, we must have an opinion on where the price is heading to...and since yours is that ARE is going to lose grounds, then a Short Vertical Call Spread or Call Back Ratios are appropriate tactical approaches... as i looked into the option chains...i see that the open interests is low for ARE options...this could be a disadvantage...as low liquidity can lead to slippages

in short...i say like no say....