4 Trade Ideas for Johnson & Johnson: Bonus Idea

• Posted by Greg Harmon
• on April 22nd, 2024

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

Johnson & Johnson, $JNJ, comes into the week trying to round off a bottom. The RSI is rising out of an oversold condition with the MACD curling up towards a potential cross. There is resistance at 151 and 152 then 153.25 and 156 before 157.50 and 160 then 162.50. Support lower is at 144 and 140.50 then 136.50. Short interest is low under 1%. The stock pays a dividend with an annual yield of 3.35% and does not begin to trade ex-dividend until May 20th.

The company is expected to report earnings next on July 17th. The May options chain shows the largest open interest at the 145 then 150 and 140 strikes on the put side. The call side builds from 145 to a peak at 165. In the June chain it builds from 165 to a peak at 150 then tails to 130 on the put side. On the call side it builds from 145 to a peak at 170 then tails to 185. Finally, in the July chain, covering earnings, open interest builds from 160 to a peak at 105 before tailing to 135 on the put side. The call side is biggest at 160 and 170.

Johnson & Johnson, Ticker: $JNJ

Trade Idea 1: Buy the stock on a move over 148.25 with a stop at 143.

Trade Idea 2: Buy the stock on a move over 148.25 and add a May 145/140 Put Spread (85 cents) while selling the June 160 Call (40 cents).

Trade Idea 3: Buy the May/June 150 Call Calendar ($1.05) while selling the May 140 Put (50 cents).

Trade Idea 4: Buy the July 140/155 Bullish Risk Reversal.

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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 April options expiry in the books, equity markets finished the week black and blue after taking a beating.

Elsewhere look for Gold to continue its consolidation at all-time highs in the uptrend while Crude Oil pulls back in its uptrend. The US Dollar Index continues to drift to the upside while US Treasuries pullback in their downtrend. The Shanghai Composite looks to continue the consolidation in its short term uptrend while Emerging Markets drop in broad consolidation.

The Volatility Index looks to remain low but rising keeping the pressure on equity markets. Their charts look weak, especially on the shorter timeframe. On the longer timeframe both the QQQ and SPY remain above break out levels from the start of the year, not a problem yet. The IWM has fallen back into its long channel consolidation though a failed break out. These often lead to fast moves lower. Use this information as you prepare for the coming week and trad’em well.

Cameco, Ticker: $CCJ 

Cameco, Ticker: $CCJ 

Cameco, Ticker: $CCJ 

Cameco, Ticker: $CCJ 

Cameco, Ticker: $CCJ 

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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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