DIA has been up and up and up lately with no pullback at all. It is in the overbought range but no decisive motion was had Thursday or Friday. Even if this is consolidation of a new base there fundamentally should be a pullback to the last range of resistance, around $88. So how do you play this "Pivot Trade?"
I think despite the run we have had there will be a pullback, nothing dramatic but fundamentally required. People will be taking profits this week as you would normally expect in a rally of this type.
I am planning on seeing how Monday unfolds, some more earnings out before and after the bell, and will look at buying Aug 88 DIA PUTS. If it looks like we may in for a stronger pullback the next support should be around $82. I would look at spreading out between 88 and 82.
If you have time check out the same for the QQQQ and SPY!
Happy Trading...
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