Tom White, the Schwab Network's Director of Content, recently described on the network an options trade that those bullish on META's near-term outlook can undertake.
On the same segment, Rick Ducat, the network's Lead Market Technician, analyzed META's technical status.
The Bullish Options Trade on META
White suggested buying the $545 calls that expire on May 16 and selling the $575 calls that expire on May 2. If the stock rises above $550, the traders who use this strategy will realize a profit.
They will pay net premiums of $18, and their risk is $1,800 per spread, White stated.
The Technical Status of META
Over the last year, META has outperformed both the Communications sector and the stock market, rising 29% during that time, Ducat noted. But the shares have "been on a pretty consistent downward slope since February," he added.
However, recently the name has been "pushing above its downward sloping channel."
A potentially important level for the shares is around $543, which recently represented the 21-day and 52-day exponential moving averages followed by Ducat.
On the other hand, $585, which represents the stock's recent highs and the 63-day exponential moving average, "could be an important resistance point," Ducat stated.
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Disclosure: None. This article is originally published at Insider Monkey.