Top Trade Ideas for the Week of August 17, 2015: The Rest Premium

• Posted by Greg Harmon
• on August 16th, 2015

Here are the Rest of the Top 10 with Premium Content in Bold:

Anadarko Petroleum, Ticker: $APC

Anadarko Petroleum, $APC, fell hard with Oil over the back half of 2014. It rose then along trend support to test the October 2014 highs before starting back lower. July found another support zone, a possible double bottom, and the price has been rising since. The action recently has been in bull flags following moves higher. Friday saw another building with the RSI holding over the mid line and the MACD rising in support of the upside plan. A move over the 50 day SMA would trigger a buy. There is resistance higher at 78 and 82.80 followed by 86.50. Support lower comes at 75.40 and 73. Short interest is low under 2%. Enter long on a move over 78.20 with a stop at 76. As it moves over 79 move the stop to break even and then to a $2 trailing stop over 80. Take off 1/3 on a stall at 86.50 or higher. As an options trade consider the September 77.5 Calls (offered at $2.37 late Friday) and trade them like the stock trade (using the stock price as a trigger, stop and target.) Offset some cost by selling the August 28 Expiry 80 Calls (58 cents).

Expedia, Ticker: $EXPE

Expedia, $EXPE, has been moving higher all year. After a consolidation through June and July it jumped higher following its earnings report and ran to a Shooting Star top two weeks ago. It is now consolidating that move after a short pullback. Into the week the RSI has just started to turn back up and the MACD looks to be leveling. The volume pattern looks like a classic Bull Flag. There is resistance above at 122.70 and 128.25 before free air and a target to 142. Support lower comes at 119 and 116.20 before 111. Short interest is high at 11.7%. Enter long on a move over 122.70 with a stop at 119. As it moves over 124 move the stop to break even and then to a $3 trailing stop over 125.70. Take off 1/3 on a stall at 142 or higher. As an options trade consider the August 28 Expiry 123 Calls ($2.20) and trade them like the stock trade. Offset some cost by selling the August 125 Calls (60 cents). Give it more time with the September 11 Expiry 122 Calls ($4.10) and sell the August 125 Calls to lower the cost. Roll to another short Call sale each week.

Huntington Bancshares, Ticker: $HBAN

Huntington Bancshares, $HBAN, has been rising with the financial sector since the October 2014 market low. Since May rising trend support has been in place and in mid-July it met up with resistance, forming an ascending triangle. Friday found the price back at that resistance following two strong up days. The RSI is bullish and rising and the MACD is turning up, with a positive cross this week sealing the deal for more upside. There is a rising channel overhead at 12 but a Measured Move to 12.40. Resistance stands at 11.82 and then free air above. Support lower comes at 11.60 and 11.50 before 11.30. Short interest is moderate at 2.5%. Enter long on a move over 11.82 with a stop at 11.60. As it moves over 11.95 move the stop to break even and then to a 25 cent trailing stop over 12.10. Let the stop take you out. As an options trade consider the September 12 Calls (17 cents) and trade them like the stock trade. Give it more time with the October 12 Calls (27 cents).

Old Dominion Freight Line, Ticker: $ODFL

Old Dominion Freight Line, $ODFL, made a double top over 80 before pulling back through the end of July. Since touching the lower Bollinger Band® it rose sharply and has consolidated that move over last week, finding support. The RSI is bullish and started back higher Friday and the MACD is looking at avoiding a cross down. A great set up for the next leg higher. The price action is a bullish Gartley harmonic that completed in late July and the target higher on a Measured Move looks at about a full retracement of the pattern. There is resistance higher at 73.25 and 74.10 followed by 75.50 and 77.50 before 79.50 and 80.50. Support lower comes at 72 and 69.90. Short interest is moderate at 3.4%. Enter long on a move over 73.25 with a stop at 72. As it moves over 74.50 move the stop to break even and then to a $2 trailing stop over 75.25. Take off 1/3 on a stall at 80.50 or higher. As an options trade consider the September 75 Calls ($1.00) and trade them like the stock trade.

Perrigo, Ticker: $PRGO

Perrigo, $PRGO, had a steep rise off of a low in February that included a large jump in April on news of an FDA approval of new drug application. Since then though it has consolidated and is tracing out an Adam and Eve bottoming pattern. The RSI remains in the bullish zone while the MACD moves sideways in the consolidation. A break over the current resistance looks like a good place to buy for continuation. There is resistance at 196 and 200 before 204 and a target on the break out to 212 before the bigger target at 220. There is support lower at 192.50 and 185.50 followed by 180. Short interest is low at 1.1%. Enter long on a move over 196.80 with a stop at 191. As it moves over 199.50 move the stop to break even and then to a $5 trailing stop over 202. Take off 1/3 on a stall at 220 or higher. As an options trade consider the September 195 Calls ($8.70) and trade them like the stock trade. Offset some cost by selling the August 200 Calls ($1.25).

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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, heading into August Options Expiration week sees the equity markets looking to consolidate in the short term and looking better long term.

Elsewhere look for Gold to continue the bounce in its downtrend while Crude Oil just continues lower. The US Dollar Index seems content to move sideways but with a short term downward bias while US Treasuries are biased higher. The Shanghai Composite looks to continue to consolidate in the longer uptrend while Emerging Markets look ugly with more downside to come.

Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ, despite their failure to move higher last week. Their charts show weakness continuing in the IWM and consolidation in the SPY in QQQ short term. All look better longer term with the QQQ strongest followed by IWM and then SPY. Use this information as you prepare for the coming week and trad’em well.

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