COST Hits Key Levels! Must-Watch Stock on the Radar This Week

Technical Analysis (TA) and Price Action:
Costco (COST) is currently trading near the critical resistance level of $968, consolidating after a steady upward move. The price action reflects a bullish ascending wedge on the 1-hour chart, with consistent higher highs and higher lows.

* Momentum Indicators:
* MACD: Above the signal line, confirming upward momentum.
* Stochastic RSI: Overbought, signaling a potential cooldown or short-term consolidation.

* Volume: Volume is gradually increasing, supporting a bullish breakout scenario.

If COST breaks $968, the next major resistance levels are at $980 and $1,000, aligning with Gamma Call Walls. However, a failure to break $968 could lead to a pullback toward $947 or $940, providing potential entry zones for long positions.

Key Levels to Watch:
* Resistance:
* $968 (Breakout Level, Call Wall).
* $980 (Gamma Call Resistance).
* $1,000 (Psychological Resistance).
* Support:
* $947 (VWAP and first pullback zone).
* $940 (Gamma Put Support).
* $927 (Critical Support Zone).

Trading Plan:
Bullish Scenario:
1. Entry: Above $968 breakout confirmation.
2. Target: $980 (first target) and $1,000 (extended target).
3. Stop Loss: $947 (to protect downside risk).
4. Note: Look for volume confirmation and MACD alignment above zero.

Bearish Scenario:
1. Entry: Below $940 breakdown confirmation.
2. Target: $927 (first target) and $920 (extended target).
3. Stop Loss: $950 (to avoid whipsaw).

Options Trading Suggestions:
Bullish Option Setup:
* Call Option:
* Strike: $980.
* Expiration: 1-2 weeks out.
* Target Premium Gain: 50%-100%.
* Entry: After breakout above $968 with strong volume confirmation.

Bearish Option Setup:
* Put Option:
* Strike: $940.
* Expiration: 1-2 weeks out.
* Target Premium Gain: 50%-100%.
* Entry: On rejection of $968 or breakdown below $940.

Thoughts on Direction:
Costco is showing bullish momentum, and a breakout above $968 could ignite a strong rally toward $980 and beyond, driven by bullish Gamma flows and volume. However, failure to sustain above $968 may lead to a pullback, providing a better risk-reward entry point around $947-$940. The overall direction remains bullish as long as the price holds above $940.

Disclaimer: This analysis is for educational purposes only and does not constitute financial advice. Market conditions can change rapidly, especially during premarket or at market open. Be prepared to adjust your strategy accordingly. If you have any questions or need updates, feel free to PM me.