4 Trade Ideas for UPS: Bonus Idea

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

UPS, $UPS, started higher off the pandemic low. It moved slowly at first, then picked up speed as it crossed the 200 day SMA. It gapped up when it had retraced the full drop and continued to a top in October. It has traded in a range for 8 months and is now back at the top of the range. A Measured Move would give a target to 240 on a break higher.

The RSI is rising in the bullish zone with the MACD positive and moving higher as price is riding the upper Bollinger Band® up. There is no resistance above 177. Support lower comes at 168 and 159 then 155. Short interest is low at 1.2%. The stock pays a dividend with an annual yield of 2.32% and has been trading ex-dividend since February 19th. The company is expected to report earnings next on April 27th.

The April options chain shows big open interest from 170 down to 130 on the put side but focused from 165 to 180 on the call side. The April 30 chain, covering the earnings report, has open interest focused at 155 and 149 on the put side, then spread from 160 to 185 on the call side. May options are clustered from 170 to 150 on the put side and from 160 to 185 on the call side, biggest at 175. The June options chain has open interest spread from 165 down to 125 on the put side and building from 160 to a peak at 190 on the call side.

UPS, Ticker: $UPS

Trade Idea 1: Buy the stock on a move over 177 with a stop at 172.

Trade Idea 2: Buy the stock on a move over 177 and add an April 30 Expiry 175/170 Put Spread ($2.25) while selling the May 190 Calls ($1.45).

Trade Idea 3: Buy the April 23/May 180 Call Calendar ($3.35) and sell the April 30 Expiry 160 Puts (80 cents).

Trade Idea 4: Buy the June 155/180/190 Call Spread Risk Reversal ($1.35).

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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 heading into April options expiration and earnings season, sees equity markets continue to show strength with the large cap stocks leading the way.

Elsewhere look for Gold to continue its short term move to the upside while Crude Oil continues to consolidate its long move higher. The US Dollar Index may continue to pullback in its uptrend while US Treasuries bounce in their downtrend. The Shanghai Composite looks to consolidate in its uptrend while Emerging Markets digest lower after their move higher.

The Volatility Index looks to remain very low making the path easier for equity markets to the upside. Their charts look strong, especially on the longer timeframe with the SPY leading the way then the QQQ rebounding and the IWM holding. On the shorter timeframe both the QQQ and SPY look strong as they move into new highs while the IWM continues its consolidation. 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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