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A friend/reader wrote me today to ask how high I hoped my positions in Direxion Small Cap Bull 3X ETF (TNA) would be able to climb from here. Hummm... good question, so I decided to investigate.
For starters I decided to look at Fibonacci retracements. My goodness. That was a landmine. The chart is full of Fibonacci relationships, to my amazement.
As we now seem to be in a bear stock market, I think it unlikely TNA (or the SPX, for that matter) will be able to rebound such that it regains the 200 dma on its first attempt. That would make for a nice sell target.
It looks to me that the TNA 200 dma will be about $72.50 in a couple days. This price level also conveniently resides at the 38.2% retracement of the downleg begun on July 7. I think a 38.2% retracement is not an unreasonable expectation, all things considered. And, that would represent a 10% gain from today's closing price.
I have my GTC (Good til Cancelled) sell order now set at $72.50. Wish me luck!