4 Trade Ideas for 3M: Bonus Idea

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

3M, $MMM, comes into the week pushing through resistance. This is recent and a retest of the 2021 high, forming a Cup and Handle pattern with a target to 272. The RSI is rising in the bullish zone with the MACD about to turn positive. There is resistance higher from 2019 at 176.50 and 180.50 then 182 and 183.75 before looking to 2018 at 186.50 and 189 then 194 and 196. Support lower is at 172.50 and 169.50 then 167. Short interest is low at 1.4%. The stock pays a dividend with an annual yield of 1.81% and will trade ex-dividend February 13th.

The company is expected to report earnings next on April 20th. The February options chain shows biggest open interest at the 155 put and 170 call strikes. In the March chain it is biggest spread from 130 to 180 on the put side, biggest at 160, while it is enormous at the 150 call strike. The April chain has biggest open interest at the 1665 put and 160 call strikes.

3M, Ticker: $MMM

Trade Idea 1: Buy the stock on a move over 173.50 with a stop at 166.50.

Trade Idea 2: Buy the stock on a move over 173.50 and add a March 170/160 Put Spread ($3.50) while selling the April 190 Calls ($1.80).

Trade Idea 3: Buy the March/April 185 Call Calendar ($1.73) and sell the March 155 Puts ($1.21).

Trade Idea 4: Buy the April 160/175/190 Call Spread Risk Reversal ($2.25).

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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 first week of February in the books, saw equity markets show resilience recovering after a midweek trip up in a data light week.

Elsewhere, look for Gold to regroup around $5000/oz digesting the long move up while Crude Oil moves sideways in the consolidation range. The US Dollar Index is showing some strength rising off a 4 year low while US Treasuries continue to hold in the lower end of the consolidation zone and looking better lower. The Shanghai Composite looks to be pausing in the uptrend while Emerging Markets have reset momentum gauges look ready for new all-time highs in their uptrend.

The Volatility Index looks to continue to hold in the normal range making it easier for equities to move higher. The charts of the SPY, the IWM and the QQQ remain strong on the longer timeframe with the IWM leading. On the shorter timeframe the IWM is also strongest holding over support. The SPY and QQQ continue to move in consolidation just under their highs. 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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