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PYPL - Buy or Sell?

From a technical perspective this is an interesting one; After forming a double top the stock shows sign of a cup and handle pattern, although not a very clean one. Posting a strong post March 2020 rally, the stock fell into a range pattern in August and briefly dipping below the July earnings breakout levels before reaching a new all-time high on Oct-21st. Since then the stock retreated again, forming the earlier mentioned handle. The approaching the $190 levels seem to offer some support however.

Upcoming earnings on November 2nd could move the stock either way. For aggressive traders a short term selling of the stock into $190 and $165 with tight stop losses might be tempting. Personally I am more of a long term investor and thus will eye to buy a potential dip in the $170 area. Below some key considerations for my line of thought;

Technicals

Longterm uptrend with some price consolidation since mid 2020
Key support area between $165 and $170 that held true in July, August and September sell-offs
Short term support around $190, which also represents 1/2 of the cup size
Clear resistance level at $210 that can either be seen as double top (bearish) or lid of the cup (bullish)
The MACD has formed a negative (bearish) crossover on October 26th
Closing below 50 EMA on Oct-28

Given the battle between bullish and bearish indicators I will avoid rushing into a trade pre-earnings. I'd consider either putting on a limited long position or selling December 2020 puts around $170;

Limit Long Position
Limit order $170
Stop Loss $157
Take Profit $212
R/R ratio 3:1

Upon a positive breakout of the handle post earnings and confirmed support levels, I might consider seeking a more aggressive entry point.

As always, feedback, comments and ideas are highly appreciated!

***The above does not represent investment advice and is a purely personal view. Always remember, risk management is key!***

註釋

Positive breakout from downchannel. Closing in on alltime high.
MACD still negative.

Waiting for more directional clarity but remain very positive on the stock and seeking an entry point further down the line. Most likely by shorting puts at key support levels.

交易進行

Buy @ 180
TP @ 216
SL @ 175

R/R 3:1