4 Trade Ideas for GE Aerospace: Bonus Idea

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

GE Aerospace, Ticker: $GE, comes into the week breaking resistance and at a new all-time high. The Bollinger Bands® have squeezed in, often a precursor to a move. Price has also reconnected with the rising 20 day SMA. The RSI is slowly rising in the bullish zone with the MACD curling to cross up and positive. There is no resistance above 191.77. Support lower comes at 190 and 183.50. Short interest is low under 1%. The stock pays a dividend with an annual yield of 0.59% and has traded ex-dividend since September 26th.

The company is expected to report earnings next on October 22nd. The October options chain shows open interest build from 190 to 170 on the put side. On the call side it is focused and largest at the 190 strike. The November chain has biggest open interest at the 165 put and sees it grow from 160 to a peak at 210 on the call side, 10 times larger. Finally, the December chain shows open interest build from 190 to a plateau from 180 to 160 then tail on the put side. On the call side it is large and focused at the 200 and 210 strikes.

  GE Aerospace, Ticker: $GE                                        

Trade Idea 1: Buy the stock on a move over 192 with a stop at 184.

Trade Idea 2: Buy the stock on a move over 192 and add an October 25 Expiry 190/180 Put Spread ($3.40) while selling the December 210 Calls ($3.80).

Trade Idea 3: Buy the November/December 200 Call Calendar ($2.85) and sell the November 175 Put ($2.20).

Trade Idea 4: Buy the December 175/195/210 Call Spread Risk Reversal ($2.25).

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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 inflation reports behind us, saw that equity markets showed strength, the SPY ending at an all-time high.

Elsewhere look for Gold to continue its uptrend while Crude Oil consolidates in a broad range. The US Dollar Index continues to move to the upside while US Treasuries consolidate in their downtrend. The Shanghai Composite looks to reverse lower while Emerging Markets consolidate the start of an uptrend.

The Volatility Index looks to remain low making the path easier for equity markets to the upside. Their charts look strong, especially the SPY and QQQ on the longer timeframe. On the shorter timeframe both the QQQ and SPY are also now ready to resume the move higher. The IWM looks a bit less powerful but is holding near resistance, a good show of relative strength for this sector. Use this information as you prepare for the coming week and trad’em well.

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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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