4 Trade Ideas for Deere: Bonus Idea

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

Deere, $DE, had retraced the pandemic drop by August and then kept going higher. It paused as it hit the 200% extension of that drop and consolidated from November through the rest of the year. This allowed price to work back towards the 20 and 50 day SMA’s. It continued higher from there and ran to a 361.8% extension of the drop, where consolidation began again. It again was able to work back to the 20 and 50 day SMA’s and then started higher again.

The RSI is rising in the bullish zone with the MACD crossed up and positive. The Bollinger Bands® have also started to pen after a squeeze. There is no resistance higher. Support lower comes at 386 and 368 then 357. Short interest is low under 1%. The stock pays a dividend with an annual yield of 0.91% and has traded ex-dividend since March 30th. The company is expected to report earnings next on May 21st.

The May options chain shows the biggest open interest at the 380 and then 370 strikes on the put side. On the call side it is biggest at 415 but large at 380 and 400. In the June chain it is big from 330 to 370 on the put side but from 370 to 400 on the call side. The September chain has smaller open interest, and it is spread from 300 to 380 on the put side and from a peak at 350, it tails to 450 on the call side.

Deere, Ticker: $DE

Trade Idea 1: Buy the stock on a move over 397 with a stop at 386.

Trade Idea 2: Buy the stock on a move over 397 and add a May 387.50/377.50 Put Spread ($3.70) while selling the May 415 Calls ($3.90).

Trade Idea 3: Buy the May/June 420 Call Calendar ($3.85) and sell the May 370 Puts ($3.10).

Trade Idea 4: Buy the September 340/400/430 Call Spread Risk Reversal ($3.00).

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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 put the first week of May in the books, and investors started the month with a very brief sell off in the equity markets, but they did not go away.

Elsewhere look for Gold to continue its move higher while Crude Oil consolidates in the uptrend. The US Dollar Index continues to the downside while US Treasuries stall in their bounce. The Shanghai Composite looks to continue to mark time moving sideways while Emerging Markets consolidate the pullback in their uptrend.

The Volatility Index looks to remain very low making the path easier for equity markets to the upside. Their charts look strong on the longer timeframe, with the IWM and QQQ holding near highs while the SPY is leading to the upside. On the shorter timeframe again, the SPY is flexing while the QQQ tries to reverse to the upside and the IWM recovers. 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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