Seasoned Stocks Trade of the Week - United Parcel Services (UPS)

 Never Be On The Wrong Side Of Another Historically Repeating Market Cycle Or Trend…  Welcome to this week's Seasoned Stocks: Trade of the Week where we show you one trade you should be looking into for the week. We dive deep and take a look at how this stock has behaved historically during this time period. This is information you are going to want to read. We do this every week for you, so keep an eye out for another one next week. We do not give “specific” trading recommendations, rather “general” market information that’s purpose is to provide you an edge in your trading. Now, let’s get into today's report. So there’s a very good seasonal period that’s coming into play for United Parcel Service (UPS).   From a seasonal perspective, UPS has gone up 95% of the time since 1999 from Nov 29 to Dec 2. The average move up is 5.64%, which is a solid move during that 23 day trading period. Another stat that’s impressive is the Profit Factor, it’s over the top excellent at a whopping 176!! What this says is that for every 1 unit in loss, one would have made 176 units in gains... which gives us a very good feel about the overall risk adjusted returns. (see highlighted in yellow below)   Below is a year by year breakdown---key in on the one loss (only -0.64%), or even a couple of years where it had some Low Points. These are very manageable, especially for an options trader who sells premium and understands how to protect themselves should levels get tested.   Look at the backtest Query on UPS (see below); for every $1,000 invested into the stock for this 1 month period…only 1 losing year in 21 years, and it was just for a loss of $6.40. Point being, this is a historically strong seasonal month for UPS.   If we look at a few competitors, they have a tendency to be bullish seasonally at this time as well, which is always a good sign.   The overall composite of technicals on the Daily timeframe is Bullish...   If we look at UPS on a week by week breakdown, it has a solid outlook seasonally over the next month or so:   The medium term trend of the Industrial sector is bullish, the Delivery Services industry is bullish, and UPS stock itself is bullish at the moment…   Looking at the chart for UPS… Please understand I’m looking at this on Thursday afternoon, 10/29---this is what I’m seeing now, next week will look different. I see immediate overhead supply in the $226-ish area, and maybe even up into the $230 area...UPS at time of this writing is at $212-ish area. I’ve drawn in one hypothetical red daily bar (see below, labeled 1) into the future and two green hypothetical bars (labeled 2 and 3)...I want to see at least 2 lower red bars in real time, currently we don’t have that---once we do , i want to see a green bar (2, in this example) and then the 3 bar I drew trade above the previous 2 green bar high that I drew---this would tell me that we might have a trend change to the upside and I’m ok with testing the market to go long. Where you put your stops, targets and how you manage the trade is very subjective and I cannot possibly advise because I haven’t a clue what the market will do next--- unfortunately, this is your responsibility. In the interim, there $226 overhead supply which is a 6% move away from current market price of $212, which coincides with the average seasonal move up of 5.64%--- if I’m targeting a 6% move, I’ll want to have a 3% stop at a bare minimum, or I WILL NOT TAKE the trade if I’m trading the stock itself. --- (A 3% stop may not be too tight, since UPS has had a tendency to not draw down too much. It’s only drawn down to a Low Point below 3% four times in twenty-one years.)...Ideally I prefer to target 3 to 1 reward to risk (that’s why I’d prefer a further pullback), as it gives me room to manage the position and have an acceptable RvR average. That way if I have a 25% batting average during really rough periods, I can at least breakeven and survive---which is a long topic for another day.   Based on a price projection of 226, here’s a couple of trade ideas based on todays’ current market conditions (10/28/2021 at 1:30PM EST))...please understand, I’m trying to give you ideas on my thinking, this is by no means a recommendation for YOU, as I have no idea about your financial situation. That said... Here’s a possible bullish debit spread to do (see image below)...it gets you to break-even well before the “Call Ideal Strike Zone”, which mathematically enhances your odds of being profitable (over the long run). Also, with ‘debit’ vertical spreads, I want the delta to be between .15 and .25---this is at .24 which is within my parameters...hopefully UPS pushes to the 226 level, if so this will be a 100% ROI trade. --- PLEASE NOTE: the purple vertical lines are 1 standard deviation out, about 90% of the time price will not close outside of that by expiration---put sellers and/or put credit spread traders could choose to sell outside that area.   Here’s another possible trade idea (see image below)...it falls within the “Call Ideal Strike Zone”, although it’s pushing toward that outer 3rd region in the blue area, but still valid. The delta for a ‘debit’ vertical is at .17, that works for me personally. If this trade pushes up to the 226 level, it will come fairly close to a 150% ROI.   Ok. That’s about it, hopefully you’ve found value in the information provided. Please remember, do your homework, and fully understand the risk before trading anything. To learn more about more seasonal information on United Parcel Service (UPS) and other seasonal opportunities, please click on the link below to access the Seasoned Stocks software: []( Trade Smart, Chad Shirley Provided as-is for informational/educational purposes only and should not be construed as investment advice . Past performance may not be not indicative of future results. Always consult your Investment Adviser before any decision. P.S. Don’t MISS OUT… if you have the Seasoned Stocks scanner, be sure to set up email (be sure to check your Spam and Promo filters) and text alerts for your upcoming Seasoned Stocks trade alerts that you enable:   Sent to: {EMAIL} [Unsubscribe]( Spyrol Group, LLC, PO Box 1510, Clearwater, Florida 33757, United States