DailyPlay – Opening Trade (JNJ) – July 18

Bullish Opening Trade Signal

View JNJ Trade

Strategy Details

Strategy: Long Call Vertical Spread

Direction: Bullish

Details: Buy to Open 3 Contracts Sept 16, 2022 $175/$190 Call Verticals @ $6.23 Debit.

Total Risk: This trade has a max risk of $1,869 (3 Contracts x $623 per contract).

Trend Continuation Signal: This is a Bullish trade on a stock that is experiencing a bullish trend.

1M/6M Trends: Bullish/Bullish

Technical Score: 10/10

OptionsPlay Score: 97

Entering the Trade

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

Please note these prices are based on the previous day’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. This will be reflected in the Portfolio tab within the OptionsPlay platform.

Investment Rationale

JNJ had a break above the $150 level in early 2020, and ever since it traded in an upward channel. When we look at the performance of JNJ relative to the Health Care Sector we notice that it has underperformed to this sector since 2008. Over the past few weeks, this has changed and JNJ is now outperforming the Health Care Sector, with a breakout higher. With earnings coming up this week, this is a positive signal to consider. The Options Market is implying larger earnings than before at +/- 2.8% versus the +/- 2.2% over the last 8 quarters. 

JNJ Daily