S&P 500 Market Outlook: Bearish
Bearish Trade: MCD $199.51
OptionsPlay’s bearish trade for Wednesday, March 4th is McDonald’s (MCD). MCD is part of the Consumer Discretionary Sector (XLY). XLY has declined 4.15% lower over the past month and its 1m and 6m trend turned bearish on Feb 27th and is just bounced lower off its $120 resistance level.
McDonald’s 1m and 6m trend turned bearish on Feb 27th and recently bounced lower off its $200 resistance level. With a technical score of 4 (out of 10), MCD is a weak stock that will likely continue lower.
As a stop loss, if MCD were to trade above $200 for multiple days, this would invalidate our analysis and suggest cutting losses on the trade. We also recommend cutting losses on this options trade if the value of the vertical spread declines below $2.85.