MET is a downgrade risk going forward
Subscribers to Schaeffer's Weekend Trader options recommendation service received this MET commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
Insurance stock MetLife Inc (NYSE:MET) sports a bearish technical setup. The shares were just rejected at their -10% year-to-date level, breaking below the 20-day moving average with additional resistance from their 200- and 252-day trendlines. What’s more, an old trendline connecting July 2021, December 2021, July 2022, and October 2022 is also acting as resistance, while the 50-unit moving average on the hourly chart is now sloping lower.
Adding to this dismal foundation, MET is trading below pre- and post-earnings candles on the charts. The 62.50-strike call open interest (OI) level could act as a call wall, with the next put support level down near the 55-strike. Given the technical setup, MET is at risk of downgrades, considering 12 of 17 in coverage maintain "buy" or better ratings, with zero "sells" on the books.
Now looks like the ideal time to speculate with options, as MetLife stock’s Schaeffer’s Volatility Scorecard (SVS) tally of 89 out of 100 suggests it outperforms options traders’ volatility expectations – a boon for premium buyers.
Our recommended October put sports a leverage ratio of 10.2, and will double on an 8% drop in the underlying security.