Each week I use my Power Stocks scanner to find the best stocks for options trading. The ones that caught my attention this week had all of the qualities I look for in a call option—the potential for a big move up (volatility) based on technicals and past activity in the stock, and good liquidity. All of these are names you’ll recognize, and for good reason—options which do not have liquidity may trap you into a position, or prevent you from taking a large enough position to make the transaction worthwhile.
I don’t see any of these well-established stocks slowing their bullish trends soon. All have low volatility, which says to me that these names are likely to keep climbing steadily rather than shooting up all of a sudden.
- Anheuser Busch (NYSE:BUD): BUD has consistently traded above its 50-day simple moving average for over a month, and is a healthy $6 above its $93 support.
- Coca Cola (NYSE:KO): This popular blue-chip is just a dollar above its $39 support, which could serve as a good place to leg in.
- PepsiCo (NYSE:PEP): Pepsi has confirmed its upward trend after a temporary pullback. Such a bounceback is one of the most reliable buy signals or initiate calls. Support is at $75.
I’ll leave it up to you whether you want to make a big bet on out-of-the-money calls, but at-the-money calls should serve you up cool profits on these three names.
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