Top Trade Ideas for the Week December 8, 2014: Bonus Idea

• Posted by Greg Harmon
• on December 8th, 2014

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

United Technologies, Ticker: $UTX

United Technologies, $UTX, pulled back over the summer and bounced at the October market low. Some short consolidation on the rise led to the creation of an Inverse Head and Shoulders pattern, that triggered two weeks ago. This has a price objective to 120.75, about the prior high level from the Spring. The RSI is in the bullish zone and the MACD is level after the current move up. There is resistance at 111.75 and then 114 and 116.50 before 118 and 120. Support lower may come at 109 and the pattern is violated under 107. Short interest is low at 1% and the stock pays a 2.1% dividend.

Trade Idea 1: Buy the stock on a move over 112 with a stop at 109.

Trade Idea 2: Buy the December 110 Calls (offered at $2.75 late Friday).

Trade Idea 3: Buy the December 110/115 Call Spread ($2.20).

Trade Idea 4: Buy the January 110 /December 115 Call Diagonal ($3.10).

Trade Idea 5: Sell the January 110/115 Strangle ($3.30 credit).

Trade Idea 6: Sell the January 110/115 Strangle and buy the December 110 Put ($2.10).

Premium Content
The Best

The Rest Premium

Free Content
The Rest

If you like what you see sign up for more ideas and deeper analysis using the Get Premium button above.

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 next week sees equities broadly looking better higher, but signs of rotation are showing up. Elsewhere look for Gold to continue the short term channel higher in the downtrend while Crude Oil may be finding a bottom at last. The US Dollar Index continues to be strong as US Treasuries are biased lower in the uptrend. The Shanghai Composite looks to continue its uptrend, but perhaps with a short term pause while Emerging Markets are consolidating in a bear flag and biased to the downside. Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. The SPY looks good on the longer timeframe with the IWM starting to move out or a tight range higher. The QQQ looks a bit tired in the short run and money may be rotating out of it to the IWM now. Use this information as you prepare for the coming week and trad’em well.

Get my book, Trading Options: Using Technical Analysis to Design Winning Options Trades.

For a signed copy email me: Greg@dragonflycap.com

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through November 2014 Expiry and sign up here

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