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Number of messages : 502
Points : 2292
Date of Entry : 2015-06-28
Year : 33
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ma1 United Continental Holdings, Inc. (UAL)

on Tue Feb 21, 2017 9:56 pm
United Continental Holdings, Inc. (UAL), $74.71

Trade:   We recommend selling 10 Mar 78/82 bear call spread (24 DTE) at around current mid-price of $750 or better since extended intra-day.
Strategy:    Reversal bar at Major Resistance on daily/weekly charts.

Max Gain:  Premium received.
ROI:   23.1% ($750/$3,250 Max Risk).

Max Loss:   Cost basis of $78 plus premium received.
Stop Loss:  76.22.

Number of messages : 636
Points : 3702
Date of Entry : 2013-01-29
Year : 48
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ma1 Re: United Continental Holdings, Inc. (UAL)

on Tue Feb 28, 2017 7:37 pm
United Continental Holdings, Inc. (UAL), $74.25

Trade:   We recommend selling 10 Mar $78.5/81.5 bear call spread (17 DTE) for $.40/share .

Technical Setup:   Reversal at Major Resistance on daily and weekly charts.

Option Strategy:   Bear Call Credit Spread. Defined risk strategy where you make maximum profit (net credit received) if the stock closes below the short call strike at expiration.  We sell call strike price above resistance where the pattern suggests that the stock will not close above at expiry, and simultaneously purchase higher strike call than the one sold as a hedge and to reduce margin.  The return on investment (ROI) is the credit received divided by the maximum loss (i.e., width of strike prices less premium received).  The breakeven is the lower strike price less credit received (i.e., also your cost basis if assigned the stock).  Considered a mildly bearish strategy since we are not buying puts (or shorting stock) and just calling a short-term top in the pattern.  Trade has positive theta (meaning you make money on time decay) making it a high probability trade since we time with the technical pattern.

Stop Loss:  $77.22.

source: mastertrader
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