4 Trade Ideas for Adobe: Bonus Idea

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

Adobe, $ADBE, comes into the week moving up at the 100 day SMA. It has been rising off of a low in June. That exceeded 113% retracement of the last leg higher. The Bollinger Bands® are open to the upside to allow a move. The RSI is rising in the bullish zone with the MACD positive and moving higher. There is resistance at 239 and 245 then 255 and 263 before 274 and 283.50. Support sits at 224 and 214. Short interest is moderate at 4.9%. The stock does not pay a dividend.

The company is expected to report earnings next on September 10th. The August options chain has large open interest spread from 250 down below 190 on the put side and is biggest at 220 below and 240 above on the call side. The September chain has biggest open interest below at 220 then 200 on the put side but with very large open interest at 280 above. On the call side open interest is biggest at 260. In the October chain there is biggest open interest at the 200 put strike. Open interest is biggest at 230 but spread from 240 to 250 above on the call side.

Adobe, Ticker: $ADBE

Trade Idea 1: Buy the stock on a move over 241 with a stop at 233.

Trade Idea 2: Buy the stock on a move over 241 and add an August 235/220 Put Spread ($7.65) while selling the September 275 Call ($7.70).

Trade Idea 3: Buy the August/September 250 Call Calendar ($8.35) while selling the September 200 Puts ($5.00).

Trade Idea 4: Buy the October 210/250/280 Call Spread Risk Reversal ($3.50).

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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 with July options expiry in the rearview mirror and heading deep into earnings season, saw equity markets seeming to be a bit unsettled as the high correlation between the indexes slightly unraveled.

Elsewhere, look for Gold to continue the downtrend but with Crude Oil reversing to the upside. The US Dollar Index looks to continue to hold at the top of the 15 month range while US Treasuries continue to threaten to break down through support in consolidation. The Shanghai Composite looks to continue the confirmation of a reversal to a downtrend while Emerging Markets hang on by a thread in their uptrend.

The Volatility Index looks to continue in the normal zone after a threat of a move higher keeping at least a slight tailwind behind equities. They could use that as the charts of the SPY, the QQQ and the IWM are showing cracks on the shorter timeframe. The QQQ is the worst followed by the IWM with the SPY holding the strongest. They all continue to look strong on the longer timeframe consolidating at the highs. Use this information as you prepare for the coming week and trad’em well.