Seasoned Stocks Trade of the Week - Equity Commonwealth (EQC)

 Never Be On The Wrong Side Of Another Historically Repeating Market Cycle Or Trend…  Welcome to this week's Seasoned Stocks: Trade of the Week where we show you one trade you should be looking into for the week. We dive deep and take a look at how this stock has behaved historically during this time period. This is information you are going to want to read. We do this every week for you, so keep an eye out for another one next week. We do not give “specific” trading recommendations, rather “general” market information that’s purpose is to provide you an edge in your trading. Now, let’s get into today's report. Equity Commonwealth (EQC) is an internally managed and self-advised real estate investment trust (REIT). The Company is primarily engaged in the ownership and operation of office properties in the United States. REITs tend to be very methodical. They usually don't undertake drastic strategy changes overnight. Instead, they'll often make small moves to test the waters in a new market or property type. However, over the past year Equity Commonwealth is transitioning from the office sector to the fast-growing industrial real estate industry by merging with Monmouth. The remade Equity Commonwealth will have a solid platform and a strong financial profile to drive future expansion. That makes it an intriguing option for investors seeking exposure to industrial real estate. Now on with the seasonal data and analysis… Below you will see that Equity Commonwealth (EQC), since 1987, has gone up 91% of the time from Dec 15 to Feb 4. It’s got an amazing Profit Factor of 24, meaning for every $1 it lost, it made $24 profit. Additionally, the Average Move Up was almost +9.5%.   LIMITED TIME ONLY [CLICK HERE FOR 50% OFF SEASONED STOCKS SCANNER]( [CLICK HERE](  Historically speaking, there’s not been very significant downside volatility. Only 3 times since 1988 has the stock lost money from Dec 15 to Feb 4. As a matter of fact, I averaged the Low Points, and they came up to only -2.62%. That’s pretty solid. Also, the average High Points came up to +11.16%, which is very attractive versus the average Low Point. See data below…   The cumulative chart below shows that the average mean P/L movement of the stock has a strong tendency to move up from mid-December, on into February and beyond towards early April.   During the same starting time period of December 15, the competitors have an overall historical consensus of making an upside move as well. This is a nice confirmation to have.   LIMITED TIME ONLY [CLICK HERE FOR 50% OFF SEASONED STOCKS SCANNER]( [CLICK HERE](  If I were looking to buy the stock next week — what follows is all hypothetical, as I’m looking at this on Tuesday 12/7, the week prior to the seasonal dates, in order to plan ahead… The chart below shows my initial 3:1 reward-to-risk ratio target ‘potential’, and what my initial thinking is...there might be trapped buyers in the $28-$29 range from the springtime of last year, thus creating possible overhead supply in that area. As I look today (12/7), a channel break up to $25.74 might trigger a test of the market reversal to the upside, with a stop at $24.76. Target 1 = $26.73. Target 2 = $27.72. Target 3 = $28.70. Should the seasonals play out, a + 9-10% move is conceivable, based on average historical 9.5% moves up. With a price entry of $25.74, a 9% move comes in at a $28.05 target, and a 10% move comes in at a $28.31 target. If you average the High Points they actually come out to over 11%, being that’s the case, a potential 28.57 target might come into play. You’ll notice that I’ve drawn some potential upside road bumps that project past mid-October’s previous pivot high. The second magenta line level is just short of $28. That’s where I focus my attention. I want to see what price bars do coming up into that level to decide if I’ll exit some, scale out all together, or if there’s potential interest for further move to the upside. I’ll manage the position along the way, with the intent of mitigating downside risk and protecting some profits along the way. I drew some road bump price projections from the early August pivot low. Hopefully those levels hold, if not, so be it and I’m out at a $0.98/share loss.   Here’s an option debit spread—REMINDER: I looked at this on Tuesday 12/7. Buy the July 15, 2022 call. Sell the July 15,2022 call; for a debit of 1.83 or Better. If the price gets to $28 (you’ve got until the summer of next year to be correct), you would take profit at roughly $125/contract hypothetically. I do not love this trade, from a risk versus reward perspective, but this is the best directional debit ‘spread’ the market will provide me personally. There’s plenty of time to get the direction right, and/or get it above breakeven. I can rest comfortably on this one for a while, no need to babysit.   You could also Buy a Call with the July 15,2022 expiration. Debit of 2.05 or Better. — REMINDER: I looked at this on Tuesday 12/7. This trade has 220 days until expiration. You’ll see 199, 178, and 157 days until expiration on the risk graph below. These are random points in time, so in another 21, 42 or 63 days in the future this is what the risk graph tells us. If the stock moves up to $28— you could potentially make about $250-$280 per contract—this assumes volatility remains constant, which there’s no guarantee. It’s possible to get that kind of move within the next 2 months or less. Based on the seasonals, it averaged that move in 35 trading days, or a bit less than 2 months. That is within the 1 standard deviation line (purple vertical line at 29.10 area), so it’s certainly possible. If you look at a downside move during those random points in time over the next 2 months, you would experience a $100-$125 loss if it got down to the 20.75 area. This is outside the 1 standard deviation level (purple vertical line at 21.90 area) to the downside, with a high probability that it won’t stay down there prior to expiration. Now you could get out at a loss, which is a 2:1 reward to risk ratio, that being a good minimum Reward-vs-Risk starting point when trying to pick direction.   In closing, there’s a million ways to trade, and there’s no ‘one and only’ holy-grail way to trade. The main key is to always focus on risk first. Hopefully these perspectives have proved worth your time, and you find which best fits your personal style. Ok. That’s about it, hopefully you’ve found value in the information provided. Please remember, do your homework, and fully understand the risk before trading anything. To learn more about seasonal information on Equity Commonwealth (EQC) and other seasonal opportunities, please click on the link below to access the Seasoned Stocks software:  LIMITED TIME ONLY [CLICK HERE FOR 50% OFF SEASONED STOCKS SCANNER]( [CLICK HERE](  Trade Smart, Chad Shirley Provided as-is for informational/educational purposes only and should not be construed as invest.ment advice . Past performance may not be not indicative of future results. Always consult your Investment Adviser before any decision. P.S. 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