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Swing Trade Idea (DFS) – December 14, 2021

Our bearish trade for Tuesday, December 14th is Discover Financial Services (DFS). DFS is part of the Financials sector that has recently moved lower by 3.5% in the last month. 

DFS recently broke below the $120 support turned resistance level and rejected this level on the retest which provides a good risk/reward bearish entry. The 6M trends are bearish and the 1M trend is expected to follow soon. 

As a stop loss, if DFS were to trade above $120 for multiple days, this would invalidate our analysis and focus on reducing losses on the trade. We also consider reducing losses on this options trade if the value of the vertical spread moves below $1.73.