Top Trade Ideas for the Week of July 30, 2012: Bonus Idea
- Posted by Greg Harmon
- on July 30th, 2012
Here is your Bonus Idea with links to the full Top Ten:
Bristol Myers Squibb, Ticker: $BMY
Bristol Myers Squibb, $BMY, is part of the large cap healthcare stocks that have been doing very well lately. it broke out of an ascending triangle in June and has retested the breakout level at 34.50 as support twice holding both times. Now at resistance at 36.25 it still has a Measured Move higher from the triangle break to 38 and now reinforced from a channel break over 36.25. The Relative Strengthen Index (RSI) is bullish and rising with a Moving Average Convergence Divergence indicator (MACD) that is about to cross positive. Support is found lower under 34.50 at 33.50 and 33.00 followed by 32.20 and 31.15 before a gap to 30.74.
Trade Idea 1: Buy the stock on a move over 36.25 with a 75 cent trailing stop.
Trade Idea 2: Buy the August Monthly 36 Strike Calls on a move over 36.25. These were offered at 53 cents late Friday.
Trade Idea 3: Buy the September 36/38 Call Spread and sell the September 34 Put. This combination was offered at 45 cents late Friday.
Trade Idea 4: Buy the August/September 37 Call Calendar. This was offered at 32 cents late Friday.
Trade Idea 5: Buy the August/September 37 Call Calendar selling the September 34 Put. This was offered at 7 cents late Friday.
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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 Saturday which, heading into the height of summer and the Olympic fortnight the markets are looking up, although not all equally. Gold and Crude Oil are looking to continue to move higher with a chance that Gold consolidates. The US Dollar Index and Treasuries are poised to continue their pullbacks within the uptrend. The Shanghai Composite is heading lower while Emerging Markets may consolidate their recent move higher before continuing. Volatility looks to remain subdued allowing for the Equity ETF’s SPY, IWM and QQQ to continue higher. The bias in the US Dollar Index and Treasuries support more upside for equities as well. Looking at their charts shows that the SPY is the strongest and looks to continue higher while the QQQ is next followed by the IWM, both of which need to break above consolidation areas to look more healthy to the upside. Use this information as you prepare for the coming week and trade’m well.
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
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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