Driving into Earnings with JB Hunt Transportation
- Posted by Greg Harmon
- on April 12th, 2012
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.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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