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.

Vote
Vote to see results
Total Votes:

Not a Scientific Survey. Results may not total 100% due to rounding.

Videos

Trades to Watch

Trader Bios

About

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.

Sara Eisen

Sara Eisen joined CNBC in December 2013 as a correspondent, focusing on the global consumer. She is co-anchor of the 10AM ET hour of CNBC's "Squawk on the Street" (M-F, 9AM-11AM ET), broadcast from Post 9 at the New York Stock Exchange.

In March 2018, Eisen was named co-anchor of CNBC's "Power Lunch" (M-F, 1PM-3PM ET), which broadcasts from CNBC Global Headquarters in Englewood Cliffs, N.J.

Read more

Connect