Swing Trade Idea (EA) – July 11, 2023
OptionsPlay’s bearish trade for Tuesday, July 11th is Electronic Arts Inc. (EA). EA is part of the Communication Services Sector, which has performed at -0.31% over the last week, with EA performing at 0.65% over the same period, as both are pulling back from the top of a trend channel.
EA found resistance at a multi-month key level of $130 and is currently respecting this area as it is showing signs of weakness. As this is a counter trend trade, a pullback is expected toward support at $123 or $114. This area has been the top of the trading range for EA over the last 12 months, while its sector is also pulling back from the top of a trading range. This confirms our bearish bias for this trade.
As a close, if EA were to trade above $148 for multiple days, this would invalidate our analysis and we will consider cutting losses on the trade. We will also consider cutting losses on this options trade if the value of the vertical spread moves above $7.60.
