4 Trade Ideas for Bristol-Myers Squibb: Bonus Idea

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

Bristol-Myers Squibb, $BMY, found support in March after falling for a month. It bounced from there, continuing to a lower high in May. The pullback from there found support at a higher low in June and it reversed again. Since then it has met resistance just over the 50 and 200 day SMA’s. This action has built an ascending triangle since June and it ended the week back at the top of the triangle. A break to the upside gives a target to 66. That would take it over the falling trend resistance from the January high.

The RSI is rising and now on the edge of a move into the bullish zone. The MACD ix lifting off of the zero level into positive territory. The Bollinger Bands® are also turned to the upside. There is resistance at 60.50 and 61.85 then 62.90 and 65 before 67.40 and 68.25. Beyond that there is some resistance but from back in 2016 and 2018, up to 76. Support lower comes at 59.40 and 57.30 then 56 and 55. Short interest is low at 1.3%. The stock pays a dividend with an annual yield of 2.98% ad began trading ex-dividend on July 2nd. The company is expected to report earnings next on August 6th.

The July 24 Expiry options chain has open interest at 50 and then spread from 53 to 60 on the put side. The call side is much bigger and focused at 60. That is the same for the call side on the July 31 Expiry options while there is very little open interest at that maturity on the put side. The August 7 Expiry options, which cover the earnings report, have open interest focused at the 57 call. The August monthly options have the biggest open interest at the 60 put then smaller size at 55 followed by 57.50 and 52.50.Again the call side is bigger with the biggest at 60 then 65 and 67.50 followed by 62.50.

Bristol-Myers Squibb, Ticker: $BMY

Trade Idea 1: Buy the stock on a move over 60.50 with a stop at 58.50.

Trade Idea 2: Buy the stock on a move over 60.50 and add an August 7 Expiry 59/56 Put Spread (85 cents) while selling the August monthly 65 Calls (65 cents).

Trade Idea 3: Buy the August 62.50/August 7 Expiry 65 Call Diagonal ($1.10) and sell the August 7 Expiry 55 Put (55 cents).

Trade Idea 4: Buy the August 55/62.50/65 Call Spread Risk Reversal (5 cents).

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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 July Options expiration in the books, saw equity markets showed some rotation, out of technology and into small caps and, to a lesser degree, large caps.

Elsewhere look for Gold to consolidate in its uptrend while Crude Oil consolidates under resistance. The US Dollar Index continues to drift to the downside while US Treasuries rise in the consolidation range. The Shanghai Composite looks to continue the pullback in the uptrend while Emerging Markets pause in their uptrend.

The Volatility Index looks to continue to slowly move lower making the path easier for equity markets to the upside. Their charts continue to look strong, especially on the shorter timeframe. The QQQ looks to have given up the leadership role and is pausing, perhaps prepping for a pullback, while the SPY and IWM move up out of recent consolidation. 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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