4 Trade Ideas for Pfizer: Bonus Idea

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

Pfizer, $PFE, had a strong run higher following approval of their COVID-19 vaccination to a top in early December. It pulled back from there, eventually retracing the full move higher at the low 2 weeks ago. Now the price is move back up and ended last week at resistance. The SMA’s are all coming together, often a prelude to a big move, with the Bollinger Bands® starting to open to the upside.

The RSI is rising and near a move into the bullish zone with the MACD also moving higher and near a push to positive. There is resistance at 35 and 35.80 then 36.25 and 37 before 37.75 and 38.40 then 39.15 and 39.80. Support lower comes at 34.40 and 33.40. Short interest is low at 1.2%. The stock pays a dividend with an annual yield of 4.46% and has been trading ex-dividend since January 28th. The company is expected to report earnings next on April 26.

The March options chain shows strong open interest from 33 to 37 with the top at 35 on the put side. The call side is bigger and focused from 35 to 39, biggest at 37. The April chain builds to a peak at 35 on the put side with the call peak there as well and tailing higher. The April 30 chain is just getting started so one needs to look at the June chain to cover earnings. It shows the open interest building to a plateau from 32 to 35 on the put side and spread from 35 to 45, but biggest at 40 on the call side.

Pfizer, Ticker: $PFE

Trade Idea 1: Buy the stock on a move over 35 with a stop at 34.

Trade Idea 2: Buy the stock on a move over 35 and add an April 34/33 Put Spread (26 cents) while selling the June 40 Calls (32 cents).

Trade Idea 3: Buy the June 35/April 37 Call Diagonal ($1.25) and sell the April 33 Put (27 cents).

Trade Idea 4: Buy the June 32/36/40 Call Spread Risk Reversal (17 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 heading into March options expiration sees equity markets mixed with small caps and large caps looking strong but the heavily tech weighted Nasdaq looking weaker.

Elsewhere look for Gold to continue its pullback while Crude Oil continues to move higher. The US Dollar Index looks to pullback in the reversal higher while US Treasuries continue the downtrend. The Shanghai Composite is possibly reversing higher while Emerging Markets pullback in their uptrend.

The Volatility Index looks to remain low making the path easier for equity markets to the upside. The charts for SPY and IWM look strong, especially on the longer timeframe. On the shorter timeframe both are now making new highs signaling renewed short term strength. The QQQ is now the problem child with a series of lower highs signaling short term weakness, but with no real long term damage as yet. 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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