4 Trade Ideas for Unilever: Bonus Idea

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

Unilever, $UL, started to move higher off of a March low. It paused in April and consolidated until a second move higher at the end of May. That move stalled out as it crossed the 200 day SMA and it pulled back to the 50 day SMA in July. As it returned to the 200 day SMA it gapped higher and ran to the current top. It has consolidated in a broad range since. Friday saw it return to the top.

It has a RSI rising in the bullish zone with the MACD crossed up and moving higher. The Bollinger Bands® are starting to turn higher as well. There is resistance at 62.95 and 64 then 64.85. Support lower comes at 62 and 61.50 then 59.75. Short interest is low under 1%. The stock pays a dividend with a 3.63% annual yield and has been trading ex-dividend since August 6th. It is expected that the company will report earnings next on or about November 11th.

The October options chain shows big open interest focused at the 60 and 62.50 strikes on both the put and call sides. The November options chain shows open interest more spread out on the put side, ranging from 45 to 57.50 and then again at 70. On the call side it is spread from 55 to 70 but far and away the biggest at 57.50.

Unilever, Ticker: $UL

Trade Idea 1: Buy the stock on a move over 63 with a stop at 61.

Trade Idea 2: Buy the stock on a move over 63 and add a November 60/57.50 Put Spread ($1.70) while selling the November 65 Call ($1.10).

Trade Idea 3: Buy the October/November 65 Call Calendar (80 cents) and sell the October 60 Put (35 cents).

Trade Idea 4: Buy the 57.50/65/70 Call Spread Risk Reversal for a 10 cent credit.

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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 as the 4th Quarter begins, sees equity markets are hinting at a rebound from an ugly September.

Elsewhere look for Gold to continue its short term move higher while Crude Oil consolidates in a broad range. The US Dollar Index looks to be reversing to the upside while US Treasuries drift lower in consolidation. The Shanghai Composite looks to continue in consolidation while Emerging Markets consolidate under long term resistance.

The Volatility Index looks to remain in moderate territory not really hurting or making it easier for equity markets to the upside. Their charts look stronger on the longer timeframe, reversing off of the downtrend. On the shorter timeframe the IWM is breaking a bull flag to the upside, leading the markets. Both the QQQ and SPY are stalled though and without making higher 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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