4 Trade Ideas for AstraZeneca: Bonus Idea

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

AstraZeneca, $AZN, comes into the week at an all-time high. This follows the break of resistance last week and has pushed the Bollinger Bands® open. The RSI is rising in the bullish zone with the MACD positive and rising after a reset lower. There is no resistance above Fridays close. Support lower comes at 81 and 80 then 78. Short interest is low under 1%. The stock pays a dividend with an annual yield of 1.82% and will trade ex-dividend on August 9th.

The company is expected to report earnings next on November 12th. The August options chain shows big open interest at the 77.50 and 75 put strikes and then on the call side at the 80 and 85 strikes. In the September chain there is a spike in open interest at the 67.50 put strike and the 85 call. The October chain has open interest spread from 80 to 75, biggest at 77.50 on the put side. The call side is elevated from 77.50 through 85. Finally, the January chain, the first to cover the earnings report, shows large open interest on the put side from 72.50 to 62.50. On the call side it is large from 70 to 95, biggest at 95.

AstraZeneca, Ticker: $AZN

Trade Idea 1: Buy the stock on a move over 82 with a stop at 78.

Trade Idea 2: Buy the stock on a move over 82 and add a September 80/75 Put Spread ($1.23) while selling the January 95 Call ($1.28).

Trade Idea 3: Buy the September/January 85 Call Calendar ($3.89) while selling the October 77.50 Put ($1.47).

Trade Idea 4: Buy the January 75/85/95 Call Spread Risk Reversal ($1.14).

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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 the July FOMC meeting in the books, noted equity markets showed concern with a very weak end to the week with weak employment data.

Elsewhere look for Gold to continue its assault on new highs while Crude Oil breaks consolidation lower. The US Dollar Index continues to short term move to the downside while US Treasuries possibly reverse to an uptrend. The Shanghai Composite looks to continue the short term move lower while the short term breakout higher in Emerging Markets is at risk of failing.

The Volatility Index looks to remain elevated and rising making the path easier for equity markets to the downside. The charts of the SPY and QQQ continue to look productive on the longer timeframe but with continued weakness on the shorter timeframe. The IWM looks to have given traders yet another disappointment with yet another failed breakout higher. 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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