Swing Trade Idea (MS) – October 12, 2021
OptionsPlay’s bearish trade for Tuesday, Oct 12th is Morgan Stanley (MS). MS is part of the Financial Sector (XLF). XLF has experienced a 2.79% gain in the last month as rotation into XLF continues.
MS has recently broken below its $100 support level and has retested this level with a rejection. Price action has completed a topping formation after a 83% rally from the Nov election breakout. The 1M and 6M trends turned bearish and neutral last week. With a last score of 9 (out of 10), MS is a strong stock that is starting to turn lower.
As a close, if MS were to trade above $105 for multiple days, this would invalidate our analysis and we would recommend cutting losses on the trade. We also would consider cutting losses on this options trade if the value of the vertical spread moves above $5.50.