Stocks constantly establish support and resistance levels that can give traders a false impression of where price will have the biggest reaction. Our job as options traders is to find the most meaningful levels, or the levels we have the highest probability of getting a strong reaction.

The same is true with our stock of the day and possibly, our trade of the week. Home Depot (HD) is our stock in focus today as it approaches a key level at 310. While it is approaching an overhead level of what we would normally consider resistance, we actually are looking at this trade to the upside.

Given that the market is approaching a support level we think could trigger the next leg of the rally and reignite the bull rally, we are waiting for a break and hold above this key level. If you watch the video below, you will see that this level has served as a catalyst for several price movements, which is why we are watching that level now.

If the market were to pick up some steam in this week into next, we will continue to watch this trade and are now deeming this, the trade of the week. Make sure to mark your charts and add this trade to your watchlist.

Learn to find these levels for yourself when you join The Profit Machine. There, you’ll learn all about my favorite stocks, setups, strategies, and plenty more. You’ll also be invited to weekly webinars where I answer questions and go over important trading lessons, like the one in today’s article. The best part, you’ll also receive live trade alerts. Not only will you get a world-class education, but you’ll earn while you learn.