4 Trade Ideas for Meta: Bonus Idea

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

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

Meta Platforms, $META, comes into the week breaking a short term consolidation after a minor pullback from a high at the end of July. It has retraced over 61.8% of the drop from the all-time high to the November 2022 low. The RSI is rising in the bullish zone with the MACD positive and rising. The Bollinger Bands® are opening higher. There is resistance at 325.50 and then 327.50 and 340 before 352 and 367 then 375 and the all-time high at 384.33. Support lower comes at 312 and 307 then 299. Short interest is low at 1.4%. The stock does not pay a dividend.

The company is expected to report earnings next on October 25th. The October options chain shows biggest open interest from 302.50 to 292.50 on the put side and at 302.50 and 322.50 on the call side. The October 27th chain, covering the earnings report has biggest open interest at from 310 to 295 on the put side and at the 315 and 330 call strikes. The November chain has biggest open interest at the 305 put and call with sizeable open interest from 310 to 360 on the call side above. The December chain has biggest open interest at the 330 put and 345 then 335 call.

Meta Platforms, Ticker: $META

Trade Idea 1: Buy the stock on a move over 317 with a stop at 307.

Trade Idea 2: Buy the stock on a move over 317 and add an October 27 Expiry 315/295 Put Spread ($8.00) while selling the November 350 Call ($7.00).

Trade Idea 3: Buy the October 27 Expiry/November 350 Call Calendar ($2.70) while selling the October 27 Expiry 270 Put ($2.45).

Trade Idea 4: Buy the December 275/320/345 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 with the first full week of October in the books, saw equity markets showed resilience as they found support and reversed after a continued move lower.

Elsewhere look for Gold to continue its downtrend while Crude Oil continues in the fast short term move lower. The US Dollar Index continues in an uptrend but on a three day losing streak while US Treasuries trend lower. The Shanghai Composite looks to reopen after a week off continuing the bias to the downside while Emerging Markets sit at support in consolidation.

The Volatility Index looks to remain low making the path easier for equity markets to the upside. Their charts have improved on the shorter timeframe but in what could still turn out to be an oversold bounce. On the longer timeframe both the QQQ and SPY are printing bottoming candles. The IWM continues to run its own race in a broad but tightening consolidation. 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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