- Posted by Greg Harmon
- on November 15th, 2021
Here is your Bonus Idea with links to the full Top Ten:
Aflac, $AFL, made a top in June and pulled back. It found support in July and bounced, establishing the range that has held it for 5½ months. It comes into the week at the top for the 4th time off of a higher low at the end of October. The RSI is rising in the bullish zone with the MACD flat but positive. There is no resistance above 57.65. Support lower comes at 56 and 54 the 52.85 and 52 before 51.25. Short interest is low at 2.4%. The stock pays a dividend with an annual yield of 2.32% and begins trading ex-dividend on Tuesday. The company is expected to report earnings next on February 1st.
The November options chain shows biggest open interest at the 55 put but more than 10 times bigger at the 62.50 call. In the December chain the biggest open interest is at the 55 put and both the 55 and 57.50 call strikes. In January the open interest is more widely spread on the put side and biggest at 25. On the call side it is biggest at 60. Finally in the February chain the 60 strike is the largest on both sides.
Aflac, Ticker: $AFL
Trade Idea 1: Buy the stock on a move over 57.65 with a stop at 56.
Trade Idea 2: Buy the stock on a move over 57.65 and add a December 55/52.50 Put Spread (60 cents) while selling the February 62.50 Calls (40 cents).
Trade Idea 3: Buy the January/February 60 Call Calendar (50 cents) while selling the December 52.50 Puts (60 cents).
Trade Idea 4: Buy the February 50/60/62.50 Call Spread Risk Reversal (10 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 heading into the November options expiration week, equity markets showed resilience reversing an early week plunge.
Elsewhere look for Gold to continue its new uptrend while Crude Oil consolidates at the recent highs. The US Dollar Index also looks to continue its breakout higher while US Treasuries consolidate in their bounce. The Shanghai Composite looks to continue to churn sideways while Emerging Markets consolidate in a bull flag over long term support.
The Volatility Index looks to remain very low making the path easier for equity markets to the upside. Their charts look strong, especially on the longer timeframe. On the shorter timeframe both the QQQ and SPY look to have reversed a small pullback while the IWM still needs to trigger. 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.