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Swing Trade Idea (TMO) – July 13, 2022

Our’s bearish trade for Wednesday, July 13th is Thermo Fisher Scientific Inc. (TMO). TMO is part of the Health Care sector, which has performed at -0.14% over the last week, with TMO underperforming relative to its sector over the same period at -2.59%.

TMO is currently trading in a downtrend channel and recently made a lower high at $555 followed by a decline in strength. As both TMO, as well as its sector, have formed lower highs, we expect this level to hold as resistance. This provides a good risk/reward bearish entry. 

As a close, if TMO were to trade above $560 for multiple days, this would invalidate our analysis and consider cutting losses on the trade. We also want to consider cutting losses on this options trade if the value of the vertical spread moves below $7.73.