Shares of Boeing are set to soar, says trader

From hot to not.

Boeing shares started 2018 on fire, rallying 20 percent in January. But it's been in a holding pattern ever since, registering a scant return of 0.13 percent since Jan. 31. Now, one chart watcher says Boeing is about to throttle foward again.

"Boeing has been in consolidation for a long period of time, and it looks like we're ready to move up," Todd Gordon, founder of TradingAnalysis.com, said Thursday on CNBC's "Trading Nation."

On a chart of Boeing, Gordon notes that the stock recently broke through a downward trend that served as resistance through the summer.

That leads Gordon to believe that the former resistance at $353 is now the stock's new support level, and Boeing will rally. It closed on Thursday at $355.46 a share.

Gordon is looking for Boeing to return to its highs reached in early June, which was around $375.

As a result, Gordon wants to buy the October monthly 365-strike calls and sell the October monthly 375-strike calls for a total of $2.93, or $293 per options contract. This means that should Boeing close below $365 on Oct. 19 expiration, then Gordon would lose the $293 he paid for the trade. But should Boeing close above $375 on Oct. 19 expiration, he could make a maximum reward of $707.

Shares of the Dow component are up 21 percent on the year.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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