Driving into Earnings with JB Hunt Transportation

JB Hunt Transportation Services, $JBHT reports earnings tonight. Here are a few thoughts driving into the report.

JB Hunt Transportation Services, $JBHT

JB Hunt Transportation Services, $JBHT, is testing the top of resistance at 56 as it heads into the report with a long bullish candle after 2 weeks of a consolidation range. The Relative Strength Index (RSI) is bullish and rising while the Moving Average Convergence Divergence (MACD) indicator is negative but improving. Both of these support a continued move higher. Support comes below 54.10 and 53 followed by 52.25 and 50.30. There is no resistance above last week’s high. The reaction to the last 6 earnings reports has been a move of about 3.6% on average or $2 making for an expected range of 53.65 to 57.65. The at-the money Straddles imply a similar move by the end of next week. This is a bit thin but if you like the stock here are a couple of trade ideas:

Trade Idea 1: Buy the May 60/50 Bull Risk Reversal for free.
You win on an upside move and own the stock at 50, good recent support on a downside break,

Trade Idea 2: Buy the May 60 Call selling the May 50/45 Put Spread for 25 cents
Same dynamics as the first trade but with capped downside risk for a quarter.

I bought a few of trade #2 for 10 cents. Enjoy.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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