DailyPlay – Opening Trade (UAL) – June 27, 2022

Bullish Opening Trade Signal

View UAL Trade

Strategy Details

Strategy: Long Call Vertical Spread

Direction: Bullish

Details: Sell to Open 6 Contracts Aug 19, 2022 $38/$47 Call Verticals @ $3.03 Debit.

Total Risk: This trade has a max risk of $1,818 (6 Contracts x $303 per contract).

Counter Trend Signal: This is a Bullish trade on a stock that is experiencing a bearish trend. 

1M/6M Trends: Bearish/Bearish

Technical Score: 5/10

OptionsPlay Score: 102

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

Our bullish trade idea today is United Airlines (UAL). Airline stocks have decline across the board due to recession fears. Looking at the JETS airline ETF, price has bounced from channel support indicating further upside ahead. Additionally, UAL is outperforming JETS on a relative basis and has bounced higher from support. From a fundamental perspective, airline bookings continue to grow despite the recent pullback in price. This provides a good risk/reward bullish opportunity with the next resistance level at $47 acting as a potential target.