Nucor and the price channels

Sometimes stock prices trend between two parallel lines forming what is known as a price channel.
When a channel is recognized it can be use for trading into the channel or you can wait for the breakout over the upper channel line in a downtrend to buy the stock.

On April 16 NUE ended an uptrend closing significantly below the lower channel line, the stock zigzag for a couple of weeks, and then started a downtrend between two well defined channel lines.

On July 20, Nucor closed at 39.82, 3.56% higher over the previous close and also broke over the down trending upper line. Measuring techniques put the price target an equal distance to the width of the channel, in this case 3.5 over the breakout price of 39. That results on a target of 42.50.

At yesterday closing price of 40.30, the target price of 42.5 gives us a 5.25% profit.

Or you could buy NUE September 40 calls at around 1.6, that would give you a profit over 50% if the stock reaches the 42.5 target before September 17.