SYY gapped up on the open after earnings.

Intraday Fundamentals

From Reuters:

* Q3 EPS $0.46 vs est $0.41

* Q3 sales $9.76 bln vs est $9.48 bln

* Shares up 11 pct, at year-high (Compares with estimates, adds background in paragraoh 2; updates shares)

May 9 (Reuters) – Top U.S. food distributor Sysco Corp reported quarterly results that easily beat analysts’ expectations, as demand for its products rose even as it increased prices, sending its shares up as much as 11 percent to a year-high.

Technicals:

On our long term charts we identified 30, 31.50, and 32 as points of interest.

The Tape:

Right on the open there was high volume and a battle at 30.60ish.  SYY moved away from this price.

When a stock has gapped up, has room to run on our longer term technicals, battles at a level and then seems to hold this level, this is an excellent risk/reward trade.  Let’s call it the Gap, Battle and Go Trade.

There was the most buying around 30.63 that followed an inability to trade below 30.50.  The trade is buy near 63c with a stop below 50c and play for an opening drive.  Near 31.50 you take the trade off and reevaluate as this is the next important technical resistance level.

Perhaps you can make this trade you own.

Mike Bellafiore

Author, One Good Trade