Sunday Prep: Healthcare & Staples

I'm gonna be honest, I'm not feeling too hot today. Emotionally I feel down, and I'm showing up and prepping because:

1. I promised to myself to show up everyday
2. At the end of the day, I can't let my emotions get in the way.

I'm following the same strategy as before, though it's a little more challenging this time around. Mainly because 9 out of the main 11 sectors performed positively on Friday. Either way, I decided to look at Healthcare (XLV) and tried to find a good wave, I think I got it.

ABT

In the above, we have one month worth of data. This is also the lowest ABT has been since 2024. Why am I choosing this holding from XLV?

• The positive uptrend
• The healthy RSI that has room to shoot up.
• It is only $1 away from its 20MA
• A call contract expiring on May 1 for a strike price of $100 is currently $0.70 – a second position of $98 is $1.40

This may be a snipe shot, everything in my method is pointing to it. As always, I do want a second option available just in case, so let's look at two other options I have from XLP.

WMT

I feel a little skeptical about this one, but not too much. The RSI 70 mark was just kissed on Friday, which means it can enter in an overbought position on Monday. The uptrend doesn't lie, and it gives me a bullish momentum that may push to $130. A contract for strike $130 expiring on May 1 is currently $1.39. This gives fuels my confidence.

Let's now look at KO

KO tells me that there is an uptrend and we have a healthy RSI. My only issue with KO is its low volatility. It doesn't convince me much, but a $2 raise target of $77 expiring on May 1 is currently $0.87 which is a steal.

Lastly, I want to compare the trading volume between the last two trading days for ABT, WMT, KO

While ABT has gone down, everything in the chart is pointing for me to trade and it's the one I feel most confident on. As for WMT and KO, we can see that the trading volume did increase from April 16 - April 17, but if I had to choose from these two, I'd go with WMT.

Now, I did mention that I wanted to look at the flip side, so given that XLU and XLE were the two ETFs performing poorly on Friday, I will take a look from one of them and see if we can identify a put. While I will not enter any put contracts, I do want to observe it.

The above is a chart of VST part of XLU (utilities). Now, I'm not 100% if I'm forcing that downtrend from April 17, but hopefully not. VST closed below its 20MA and the trading volume was only 4M. If I were to consider selling a put for a strike price of $157 expiring on May 1, the price of it is $3.85

Now, I do want to clarify, this last approach is a test it's something I'm considering for the flip side. I'm not sure that it will work, but if it does, I'll shock myself. I can't wait to see what the market will do tomorrow. As usual I won't trade my first 30-45 mins and will simply wait for the morning rush to settle.

As mentioned at the beginning of this post. I am not feeling my greatest today, I am emotional about personal things in life, though prepping this made me forget for a second. If any of these trades don't go as expected, I won't blame it on my emotions, but I also will not take it as a failing strategy as I can acknowledge that I did struggle finding my trades for tomorrow. Let's hope I did this analysis from a clear head, and I hope it pays out tomorrow.