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Trader says Lockheed Martin is the defense stock to play. Here's why

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Trader says this is the way to play Lockheed Martin

Ascent Wealth Partners' Todd Gordon is eyeing one defensive name amid all the market volatility.

Despite the aerospace and defense ETF (ITA) having its worst day in almost nine years, Gordon says he believes Lockheed Martin is a relatively stable play while the broader market continues seeing its wild swings.

From a technical perspective, Gordon points out that the stock has held above its 200-day moving average, which currently sits at around $380. The trader has been using the 200-day moving average as a key indicator and says that Lockheed Martin's ability to hold the level is a strong sign for the stock.

Gordon also says the stock's increased dividend and strong cash flow strengthens the fundamental case for Lockheed. Furthermore, the trader says the name has been somewhat insulated from volatility, doesn't possess a lot of the international supply worries as many companies hit by the coronavirus outbreak, and demands for its fighter planes add to the bull case for Lockheed.

"It's a steady defense play, it's the primary contractor of the F35 joint strike fighter, and we feel with the tensions in China and Russia escalating that military spending will be funneled towards [Lockheed Martin]," Gordon said Thursday on CNBC's "Trading Nation."

Given all the volatility in the market, which is driving up the price of options, Gordon recommends going for a covered call strategy on Lockheed Martin. Namely, after buying the stock outright, he would help finance that purchase by selling the April 3 weekly 430-strike call, for which he would receive $2.30 per options contract sold.

Lockheed Martin is currently down 1% this year.