4 Trade Ideas for McDonald’s: Bonus Idea

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

McDonald’s, $MCD, has been bucking the market trend, holding near all-time highs, in my opinion, due mostly to those fries. The stock price comes into the week pressing down against support though after a long red candle Friday and at the 50 day SMA. This is a fall out of the Bollinger Bands® which are opening lower. The RSI is falling to the bottom of the bullish zone with the MACD dropping but still positive.

There is support lower at 266 and 263 then 260 and 258 before 253.50 and 252 then 249. Resistance higher sits at 269.50 and 275.50 then 278.50 and 281.50. Short interest is low under 1%. The stock pays a dividend with an annual yield of 2.28% and has traded ex-dividend since November 30th. The company is expected to report earnings next on January 25, 2023.

The December 30 Expiry options chain show biggest open interest at the 260 and 250 strikes on the put side. On the call side it is biggest at 280, 285 and 290. The January chain has big open interest every 10 points starting at 270 going to 240 on the put side and from 260 to 290 on the call side. The January 27 chain is just getting started, but the February chain has biggest open interest at 260 and 250 on the put side, while at 280 and 300 on the call side.

McDonald’s, Ticker: $MCD

Trade Idea 1: Sell the stock short on a move under 266 with a stop at 270.

Trade Idea 2: Sell the stock short on a move under 266 and add a December 30 Expiry 270/275 Call Spread ($1.65) while selling the January 250 Put ($1.24).

Trade Idea 3: Buy the December 30 Expiry 265/255 Put Spread ($2.47).

Trade Idea 4: Buy the January 13 Expiry 265/December 30 Expiry 255-January 13 Expiry 255 1×2 Put Spread ($2.60).

Premium Content

The Best

The Rest Premium

Free Content

The Rest

If you like what you see sign up for more ideas and deeper analysis here Get Premium with special holiday discounts.   

After reviewing over 1,000 charts, I have found some good setups for the week. This week’s list contains the first five below to get you started early. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which with the last FOMC meeting and Quad Witching done for the year, equity markets have resumed their moves lower.

Elsewhere look for Gold to consolidate in the uptrend while Crude Oil moves lower. The US Dollar Index continues the trend lower while US Treasuries stall in their short term uptrend. The Shanghai Composite looks to continue the short term uptrend while Emerging Markets consolidate in their short term move higher.

The Volatility Index looks to remain in the normal range making the path easier for equity markets to the upside. It also makes the Indexes more vulnerable to news based moves like we saw this week following the CPI report and FOMC meeting. Their charts showing that weakness from the short term view leaking into the longer term view now and the weekly pictures also roll over. On the shorter timeframe both the QQQ and IWM look vulnerable to a retest of the October low. The SPY looks slightly better, but only because it has further to go to retest it. 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.

blog comments powered by Disqus
Dragonfly Caps Blog