PEP trade ideas
TRADE ENTRY: PEP CREDIT SPREADS JULY 6 AND 13stock is overbought, playing a conservative bear call spread up to 113
PEP Sell Set-UpWe were watching PEP a few days ago when we had a bear div on the daily during a weekly downtrend. Didn't take a short at the bear div because was concerned about R:R and where to take a short.
At yesterday's daily close, the pot sweetened for a PEP short as we moved up without invalidating the bear div and closed with a long upward wick (but green).
There's two ways to set this stop: Either set it very tight and damage your win rate, or set it loose and risk a larger % loss. It's not an easy choice but it has to be made so I chose the tight stop.
PEPSICO bullish patternEven though I don't use this kind of analysis, was formed a "Cup and Handle" on the PEPSICO chart. Last Friday there was the breakout that occurred with not high volume (below the 10-days moving average). Personally, I would wait for a pullback before opening a long position on PEP.
pepsi cola extremely bullishNASDAQ:PEP
went in on PEP on 06/12/2018. So far what i have seen is it has been increasing in price due to heavy volume. I don't believe I'm the only one who is seeing this explosion to the upside. keeping in mind the earnings is right around the corner for pepsi cola I believe the volume is going to continue to poor in until then. I don't plan on holding it past the earnings report as a matter of fact ill be out of the trade just before the earnings. I don't believe its too late for some one to jump in on this trade I believe there is allot of potential and profit to be made In PEP still. But keep in mind earnings are 24 days away and anything can happen. so set your stops.
TRADE EXIT: PEPSICO --- What a trade!Pretty certain the June 22nd 104/105s will expire in the money... but the profit may be greater selling the option on Monday. Unless we are expecting a push to $110 without any correction, which can certainly happen.
Me? I'll take the 2nd half of my position off here. I wouldn't short this though. Too strong, no short term signals yet, no bearish daily candle.
A potential WHEEL trade in $PEPPEP was trading around 120 in January 2018. It is currently trading around 99 and has a dividend yield around 3.75%
We're going to look for a strategy that can boost potential yield without taking on alot of risk. PEP is going to trade ex-dividend on 5/31. We are going to look to sell a put that obligates the seller of this put to take ownership of the underlying stock if it closes below the strike price at expiration. We're going to select an expiration cycle that has 18 days to go, 25MAY. We're going to look to sell a put that is 1 point out of the money, 98. We're looking to collect around $110 for selling this put option. Our margin or risk in this trade is $9800, which means that if PEP is below 98 at expiration (May 25th) we are going to take ownership of the stock at 98 per share, regardless where it is actually trading. As long as the price is below 98, we are obligated to take the stock. Here are the potential outcomes of this trade:
Stock trades and expires above 98. We get to keep $110 premium from the sale of 98 strike put. This represents about 1.12% return on risk or about 21.5% annualized.
Stock trades below 9 at expiration. We are long 100 shares of PEP at 98. Since we collect $110 by selling this option, this premium will go towards reducing cost by $1.10
Our new cost basis is actually 96.90
We are going to look to sell a call against the long 100 share position with a strike price above our cost.
When PEP pays a $0.9275 dividend, this will also go towards reducing cost basis further. After we receive the payment our new cost basis should be around $95.97
Our plan would be to continue to collect dividends and sell OTM calls against the long stock position to continue to work our cost basis lower.
Put Sale OppSell to Open PEP Jun 95 Put @1.59
Basis: 93.41
Return on Basis: 1.7%
Return With 50% Margin: 3.4%
Portfolio Margin on 10% Drop: $2,548
Return on PM: 6.24%
If assigned, then sell calls. Pull in a dividend of 0.80 to cut basis down to 92.61. Then sell a call for $1.00 and you're down to 91.61.
I think I did the math right.
PEP cup and handle pattern The Pepsi Co. chart is showing a Handle and Cup reverse pattern that suggests setting a call position on $100.01. Set a Take Profit taking on count the cup distance on $105.26 and a Stop Loss on $99.38. The chart has hiten the bottom line of the cup 5 times confirming the pattern.
PepsiCo Inc. (PEP)PEP is the number 1 in snacks and the number 2 in drinks; has a sustainable dividend payout ratio, and a yeld of 3.20%.
PEP to hit $127 by Sept 2018'PEP clearly trades within an upward channel for a number of years.
Most recently it's hit $109, which is below it's channel support line.
Bullish for PEP.
Macro forces are strong, worldwide, and in USA.
RSI is showing near historical bounce back level (around 40)
Stochastic RSI clearly in the oversold zone, suggesting price will increase.
MACD is also showing a converging histogram, moving to cross 0 soon.
ADX shows a weak trend of 25, and DI is showing negative trend right now, but if a crossover happens, then it should run up.
Short PEPShort PEP as market weakens, will be looking to go long eventually.
Use stop losses, always
What does Pepsi has in store? inside this triangle ended with a hammer and green. so this is what might happen depending on the lower time frames that I don't really mention whenever I can. If we open up to the upside that would be potential bounce up off the support
PEP - Possible Bullish Swing TradeHere is a bullish swing trade that I may take if PEP moves over the next several days as I would like it to. What I see on the daily chart is a double bottom followed by a breakout of the double bottom neckline and now the price has pulled back to re-test the neckline. What I want PEP to do over the next few days is to form an S-Curve like the blue line I have drawn. It is still too early to set an entry or stop but hopefully, they can be set sometime next week.
Here is the hourly chart where you can get a better look at the double bottom, the breakout, and the re-test.
PEPSI BOUNCEA good possible bounce area for PEP with the 1) retracement, 2) support/resistance band, 3)t/l intersection.
All this analysis is a subject to Mother Market cooperation.
