4 Trade Ideas for Johnson & Johnson: Bonus Idea

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

Johnson & Johnson, $JNJ, comes into the week one day after printing a new all-time high at the start of September. It has an RSI in the bullish zone and a MACD positive. The Bollinger Bands® are pointing higher and all of the SMA’s are also rising. There is no resistance above 279. Support sits at 274 and 269 before 265. Short interest is low under 1%. The stock pays a dividend with an annual yield of 1.95% and has traded ex-dividend since August 25th.

The company is expected to report earnings next on October 13th. The September options chain has the largest open interest at the 220 put then 210. On the call side open interest is largest at 270, below current price, then at 280 and 290 above. In the October chain open interest is biggest at the 210 put and the 280 call.  Finally, the November chain has biggest open interest at the 260 put and marginally higher at 270 then at 300 on the call side.

Johnson & Johnson, Ticker: $JNJ

Trade Idea 1: Buy the stock on a move over 280 with a stop at 268.

Trade Idea 2: Buy the stock on a move over 280 and add an October 280/260 Put Spread ($8.60) while selling the November 300 Call ($4.00).

Trade Idea 3: Buy the September/October 280 Call Calendar ($5.50) while selling the October 260 Puts ($3.05).

Trade Idea 4: Buy the November 260/280/300 Call Spread Risk Reversal ($3.65).

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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 August employment report in the books and heading into the Labor Day weekend, saw equity are a bit steadier. They now await the inflation data next week ahead of the September FOMC meeting.

Elsewhere, look for Gold to continue the pause in its uptrend with Crude Oil consolidating. The US Dollar Index looks to continue in a tight range while US Treasuries hold the move lower at 22 year lows in price. The Shanghai Composite looks set to continue to muddle under resistance while Emerging Markets creep higher in their uptrend.

The Volatility Index looks to continue low in the normal zone at the lows of the year keeping a tailwind behind equities. The charts of the SPY and QQQ are settling into ranges over support on the shorter timeframe, while the IWM is poised to make a recovery as it presses on resistance. They all continue to look strong on the longer timeframe consolidating at the highs. 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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