4 Trade Ideas for Adobe: Bonus Idea

• Posted by Greg Harmon
• on January 23rd, 2023

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

Adobe, $ADBE, comes into the week pressing on resistance and at a 4 month high. This is after finding a bottom following a better than 88.6% retracement of the post pandemic move higher. The Bollinger Bands® are opening higher with the 200 day SMA just above. The RSI is rising in the bullish zone with the MACD positive and turning higher.

There is a gap over head to fill to 365.61 and resistance above that at 368 and 379 then 390 and 395.50. Support lower comes at 356 and 348. Short interest is low under 1%. The stock does not pay a dividend. The company is expected to report earnings next on March 15.

The February options chain show the biggest open interest at 310 then 330 and 320 on the put side. On the call side it is biggest at 385 and 380. In the March chain open interest builds from 360 to a peak at 300 on the put side. On the call side it is biggest at 350 and 340 then close at 370 and 380.

Adobe, Ticker: $ADBE

Trade Idea 1: Buy the stock on a move over 358 with a stop at 348.

Trade Idea 2: Buy the stock on a move over 358 and add a February 350/330 ($5.75) Put Spread while selling a February 380 Call ($4.25).

Trade Idea 3: Buy the February/March 370 Call Calendar ($7.15) and sell the February 330 Put ($4.00).

Trade Idea 4: Buy the March 320/360/375 Call Spread Risk Reversal (65 cents).

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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 January options expiration in the books, saw equity markets showed resilience overcoming a strong move lower midweek.

Elsewhere look for Gold to continue its uptrend while Crude Oil consolidates in a tight range. The US Dollar Index continues to drift to the downside while US Treasuries are trying to mount a short term uptrend. The Shanghai Composite is in a short term uptrend while Emerging Markets continue their trend higher.

The Volatility Index looks to remain stable in the normal range making the path easier for equity markets to the upside. Their charts also look strong on the shorter timeframe with the SPY, the QQQ and the IWM all approaching resistance. On the longer timeframe both the SPY and the QQQ are nearing a long term trend breakout with the IWM near a 5 month breakout. 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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