Swing Trade Idea (SBUX) 2-3-2021
Our bullish trade for Wednesday, February 3rd is Starbucks Corp (SBUX). SBUX is part of the Discretionary Sector (XLY). XLY has experienced a 5.6% gain in the last month and its 6M trend has been bullish since November 4th 2020 and its 1M trend turned from bearish to neutral on Feb 1st.
SBUX has recently pulled back to its 100 D MA and bounced higher with strong momentum providing a good risk/reward for a long entry. With a technical score of 7 (out of 10), SBUX is a strong stock that will likely move higher.
As a stop loss, if SBUX were to trade below $97 for multiple days, this would invalidate our analysis and we would focus on cutting losses on the trade. We also consider cutting losses on this options trade if the value of the vertical spread moves above $3.16.