DailyPlay – Opening Trade (MMM) – October 1, 2024

MMM Bearish Opening Trade Signal

Investment Rationale

3M Company (MMM) has recently entered overbought territory on both daily and weekly timeframes, indicating signs of exhaustion and suggesting an increased likelihood of a selloff. While MMM is expected to grow EPS faster than its industry peers, negative revenue growth and slim margins pose significant downside risks, making it challenging for the company to meet these projections.

MMM – Daily

Trade Details

Strategy Details

Strategy: Long Put Vertical Spread

Direction: Bearish Debit Spread

Details: Buy to Open 24 MMM October 18 $135/$131 Put Vertical Spreads @ $0.86 Debit per Contract.

Total Risk: This trade has a max risk of $2,064 (24 Contracts x $86) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $86 to select the # contracts for your portfolio.

Counter Trend Signal: This is a bearish trade on a stock that formed a bearish divergence and is expected to continue lower.

1M/6M Trends: Bullish/Bullish

Relative Strength: 10/10

OptionsPlay Score: 160

Stop Loss: @ $0.43 (50% loss of premium)

View MMM Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Monday’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View MMM Trade