4 Trade Ideas for Air Products: Bonus Idea

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

Air Products, $APD, broke out of consolidation in February and rose to a plateau in May. It did not pullback though but consolidated there until another move up in June. It broke that to the upside at the end of the month and has since been building an expanding wedge against resistance at the early July high.

The RSI is rising in the bullish zone after a reset to the bottom of the range with the MACD about to cross up after also resetting to zero. There is no resistance above 232 but a Measured Move on a break out higher would give a target to 246. Support lower comes at 225 and 220 then 217 and 210. Short interest is low at 1.1%. The stock pays a dividend yielding just over 2% and starts trading ex-dividend September 30th. The company is expected to report earnings next on November 4th.

The August options chain shows the biggest open interest at the 220 put and 230 call, suggesting a tight range for this week. The September options have the majority of open interest lower, and it is biggest at the 210 strike on both sides. December options, the first covering the next earnings report, show open interest from 190 to 220, but biggest at 200 on the put side. While the December 230 calls have the biggest open interest on both side by a factor of 2.

Air Products, Ticker: $APD

Trade Idea 1: Buy the stock on a move over 230 with a stop at 227.

Trade Idea 2: Buy the stock on a move over 230 and add a September 220/210 Put Spread ($1.85) while selling a September 240 Call ($2.20).

Trade Idea 3: Buy the December 210/230/240 Call Spread Risk Reversal (60 cent).

Trade Idea 4: Buy the September/December 240 Call Calendar ($6.70) and sell the September 210 Put ($1.35).

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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 heading into August options expiration saw the equity markets took a blow to the head but shook it off to recover by the end of the week.

Elsewhere look for Gold to continue in its uptrend while Crude Oil may be ready to pause in its pullback. The US Dollar Index continues the slow grind higher in a wide channel while US Treasuries may be ready to pause in their uptrend. The Shanghai Composite and Emerging Markets have resumed their path lower.

Volatility has picked up slightly making the path higher a bit tougher for the equity index ETF’s SPY, IWM and QQQ. Their charts show good recoveries from a shock in the short run, with continued strength in the SPY and QQQ in the long term chart, while the IWM consolidates in a range. Use this information as you prepare for the coming week and trad’em 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.

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