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Swing Trade Idea (EMR) – September 14, 2023

Our bearish trade for Thursday, September 14th is Emerson Electric Co. (EMR). EMR is part of the Industrials Sector, which has performed at .80% over the last week, with GPC performing at -1% over the same period.

EMR traded into a key and long-term area of resistance at $100, where it is in an over-bought condition and expected to pull back. EMR formed a bearish diversion at this point, which confirms our counter-trend thesis on this trade. The Industrial Sector has also traded into the top of a trendline and is expected to make a correction.

As a close, if EMR were to trade above $100 for multiple days, this would invalidate our analysis and we will consider cutting losses on the trade. We will also consider cutting losses on this options trade if the value of the vertical spread moves below $0.68.