4 Trade Ideas for Deere: Bonus Idea

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

Deere, $DE, rose off of a March low and then stalled out in April. It plowed along sideways through the spring and then started to push higher at the end of May. It was not until early July that it broke and held above the 200 day SMA and started to drive higher. It ran out of gas into September and has been idling at the highs since.

The RSI has pulled back from overbought and is now reversing higher in the bullish zone. The MACD has also moved lower and is now leveling. The Bollinger Bands® are tight, a precursor to a move. There is resistance at 219.60 and 222. Support lower comes at 213.25 and 208.25 then 194. Short interest is low at 1.1%. The stock pays a dividend with a 1.39% annual yield. The company is expected to report earnings next on November 25th.

The October options chain shows the biggest open interest at the 210 and then 200 strike on the put side. On the call side it is biggest at 240 then 220 and 230. In the November chain open interest is just starting to build. The December chain is the first to cover the next earnings report. It shows the biggest open interest at the 200 strike put but spread from 175 to 220. On the call side it is wider spread from 150 to 260 biggest at 210.

Deere, Ticker: $DE

Trade Idea 1: Buy the stock on a move over 220 with a stop at 215.

Trade Idea 2: Buy the stock on a move over 220 and add an October 215/200 Put Spread ($3.75) while selling a December 250 Call ($3.75) to fund it.

Trade Idea 3: Buy the October/December 230 call Calendar and sell the October 200 Put ($6.90).

Trade Idea 4: Buy the November 190/220/230 Call Spread Risk Reversal ($1.40).

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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 only 3 trading days left in the 3rd Quarter, sees equity markets continuing to show weakness.

Elsewhere look for Gold to continue its pullback in an uptrend while Crude Oil consolidates in a broad range. The US Dollar Index looks to continue the move to the upside while US Treasuries consolidate. The Shanghai Composite and Emerging Markets looks to continue the pullback in consolidation.

The Volatility Index looks to continue the very slow move lower making the path easier for equity markets to the upside. Their charts continue to look weak, especially on the shorter timeframe. On the longer timeframe both the QQQ and SPY are building bull flags, with the IWM in a slightly weaker position. 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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