BA after earnings pop. Will it drop?Boeing had a big pop from very favorable earnings today. So far there has
not been a fade or retracement. The relative strength lines however topped
out and then retreated a bit signaling bearish divergence with the lower TF
below the higher black TF line. Likewise,
the MACD indicator is showing a line cross above the histogram whose
amplitude has dropped to zero then changed to red / negative.
Lastly, the mass index indicator shows a rise above the reversal zone
then with a trigger signal in dropping below the zone.
I conclude that BA over-extended and is now setup for a short trade which
could be either stocks or a put option. For the stock the stop loss is 232
the swing high and the target is 223.25 at the mean VWAP line. If price can
cross under that line, the target for the remaining runners will be 217 just
above a lower VWAP line. I will buy the strike $225 expiring 8/4 to potentially
exploit this expected quick retracement.