4 Trade Ideas for Oracle: Bonus Idea

Here is your Bonus Idea with links to the full Top Ten:

Oracle, $ORCL, comes into the week breaking short term resistance and above the 200 day SMA. The Bollinger Bands® are squeezing in, often a precursor to a big move. The RSI is deep in the bullish zone with the MACD avoiding a cross down and positive. There is resistance at 167.50 and 172 then 177.75 and 1181.50 before 191 and 195. Support lower is at 163 and 155. Short interest is low at 1.5%. The stock pays a dividend with an annual yield of 1.21% and has traded ex-dividend since April 10th.

The company is expected to report earnings next on June 9th after the close. The June 13 Expiry options chains shows an expected move of about $15 by expiry with biggest open interest at the 160 put and then the 165 and 1810 call strikes. The June monthly chain has biggest open interest at the 140 put then 150, and at the 165 and 160 call strikes followed by 185. Open interest is biggest at the 130 put then 140 in the July chain and on the call side at 155 then 180 and 150. Finally, in the August chain open interest is biggest at the 145 and 130 put strikes and at the 185 and 180 calls.

Oracle, Ticker: $ORCL

Trade Idea 1: Buy the stock on a move over 166 with a stop at 160.

Trade Idea 2: Buy the stock on a move over 166 and add a June 160/150 Put Spread ($3.20) while selling the July 185 Call ($3.00).

Trade Idea 3: Buy the June/July 180 Call Calendar ($1.50) while selling the June 13 Expiry 145 Put ($1.10).

Trade Idea 4: Buy the August 145/170/185 Call Spread Risk Reversal ($1.65).

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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which With the month of May in the books, saw that equity markets showed a budding recovery from last week.

Elsewhere look for Gold to continue its uptrend while Crude Oil continues to trend lower. The US Dollar Index continues a short term move to the downside while US Treasuries consolidate in their downtrend. The Shanghai Composite looks to continue in consolidation while Emerging Markets fall from the cusp of a break to the upside.

The Volatility Index looks to continue in the normal range making life easier for equity markets to the upside. Their charts show short term strength on the longer timeframe with digestion in the shorter timeframes. The IWM continues to lag the SPY and QQQ in recovery in price and the shift to bullish momentum on the longer timeframe. The classic “V” recovery continues to build in all 3 Index ETFs as the SPY and QQQ close in on their all-time highs. Use this information as you prepare for the coming week and trad’em well.