4 Trade Ideas for The Hartford: Bonus Idea

• Posted by Greg Harmon
• on June 3rd, 2024

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

Hartford Financial Group, $HIG, comes into the week at resistance for the third time. This is also just shy of the all-time high from May of 2007. The Bollinger Bands® have squeezed, often a precursor to a move, with the RSI rising in the bullish zone and the MACD crossing up and positive. There is resistance at 103.50 and 106. Support lower comes at 100 and 99.50 then 95. Short interest is low at 1.5%. The stock pays a dividend with an annual yield of 1.82% and begins trading ex-dividend on Monday.

The company is expected to report earnings next on July 25th. The June options chain shows biggest open interest at the 100 put strike and it builds from the 80 call strike to a peak at the 110 strike. The July chain has biggest open interest at the 100 put and the 105 call strikes. The September chain has biggest open interest at the 100 put strike and small amounts from 95 to 105 on the call side.

Hartford Financial Group, Ticker: $HIG

Trade Idea 1: Buy the stock on a move over 103.50 with a stop at 99.25.

Trade Idea 2: Buy the stock on a move over 103.50 and add a June 100/95 Put Spread (55 cents) while selling the July 110 Call (45 cents).

Trade Idea 3: Buy the July/September 110 Call Calendar ($1.70) and sell the July 100 Put ($1.15).

Trade Idea 4: Buy the September 95/110/120 Call Spread Risk Reversal (65 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 month of May in the books, saw equity markets showing some signs of weakness following divergences last week.

Elsewhere look for Gold to continue its consolidation in the uptrend while Crude Oil consolidates in a narrow range after a pullback. The US Dollar Index continues to drift to in broad consolidation while US Treasuries continue their downtrend. The short term move higher in the Shanghai Composite looks to be at risk of reversing while Emerging Markets enter a short term downtrend.

The Volatility Index looks to remain very low and stable making the path easier for equity markets to the upside. The charts of the SPY and QQQ look strong on the longer timeframe, but with a possible momentum reset continuing in the short run. On the shorter timeframe both the QQQ and SPY have reset to their 20 day SMA’s where they often find support. How they react next week could tell if this week was meaningful or not. The IWM continues to be the laggard, stalled near the top of a 2 year range. 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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