4 Trade Ideas for Bristol-Myers Squibb: Bonus Idea

• Posted by Greg Harmon
• on January 9th, 2023

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

Bristol-Myers Squibb, $BMY, comes into the week after a pullback from a double top. It has been in consolidation the past 3 weeks and ended last week starting to move back higher. The RSI is also rolling back up out of oversold with the MACD about to cross up. There is resistance at 73.75 and 75.50 then 77 and 78.15 before 80 and 81.25. Support lower comes at 72.50 and 71.50. Short interest is low at 1.2%. The stock pays a dividend with an annual yield of 3.12% and went ex-dividend on January 5th.

The company is expected to report earnings next on February 2nd. The January options chain shows big open interest at every $2.50 strike on the put side but biggest at 65 then 70. On the call side it is big also at $2.50 strikes from 70 to 80, biggest at 80 by a factor of 2. The February 3 Expiry has light open interest. In the February chain the biggest open interest is at the 72.50 strike on the put side and the 77.50 strike on the call side.

Bristol-Myers Squibb, Ticker: $BMY

Trade Idea 1: Buy the stock on a move over 73.75 with a stop at 71.50.

Trade Idea 2: Buy the stock on a move over 73.75 and add a February 3 Expiry 73/69 Put Spread ($1.33) while selling the February 77.50 Calls (66 cents).

Trade Idea 3: Buy the January/February 75 Call Calendar ($1.05).

Trade Idea 4: Buy the February 70/75/80 Call Spread Risk Reversal (15 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 the first week of 2023 in the books, saw equity markets show resilience with a rebound to end the week higher.

Elsewhere look for Gold to continue its uptrend while Crude Oil consolidates in a downtrend. The US Dollar Index continues to drift to the downside while US Treasuries are poised to reverse higher in their downtrend. The Shanghai Composite looks to continue in broad consolidation while Emerging Markets establish a short term uptrend.

The Volatility Index looks to remain in the normal range making the path easier for equity markets to the upside. Their charts remain vulnerable to further downside on the longer timeframe. On the shorter timeframe both the IWM and SPY are showing some promise following a Santa Claus Rally while the QQQ is lagging behind. The S&P 500 maintaining over 3839.50 Monday would give a second early year bullish indicator. If that happens traders will look for the trifecta with a positive January to round it out and give another bullish signal. 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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