Johnson & Johnson (JNJ) Offering Possible 7.99% Return Over the Next 9 Calendar Days

Johnson & Johnson's most recent trend suggests a bearish bias. One trading opportunity on Johnson & Johnson is a Bear Call Spread using a strike $101.00 short call and a strike $106.00 long call offers a potential 7.99% return on risk over the next 9 calendar days. Maximum profit would be generated if the Bear Call Spread were to expire worthless, which would occur if the stock were below $101.00 by expiration. The full premium credit of $0.37 would be kept by the premium seller. The risk of $4.63 would be incurred if the stock rose above the $106.00 long call strike price.

The 5-day moving average is moving down which suggests that the short-term momentum for Johnson & Johnson is bearish and the probability of a decline in share price is higher if the stock starts trending.

The 20-day moving average is moving down which suggests that the medium-term momentum for Johnson & Johnson is bearish.

The RSI indicator is at 37.14 level which suggests that the stock is neither overbought nor oversold at this time.

To learn how to execute such a strategy while accounting for risk and reward in the context of smart portfolio management, and see how to trade live with a successful professional trader, view more here

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