Home Depot, Inc. (HD)

Tue Jan 24, 2017 8:15 pm

Below is a daily chart of The Home Depot, Inc. (HD), $138.12.

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Trade: Over $138.50, we recommend two bullish trades: (1) buy 10 Feb (24 DTE) $137 calls (currently $6.70/share); and (b) selling 10 Feb $133/127 bull put spread (24 DTE) at midpoint (currently .61/share). On the long call, we will look to leg into a bull diagonal (i.e., shorting weekly OTM calls against the long Feb call) over time.

Strategy: Bullish Wide Range Bar (+WRB) breakout yesterday from bullish consolidation on daily and weekly charts.
Max Gain: Unlimited on long call; credit received on bull put spread.
Max Loss: Debit on long call; spread width less credit received on put spread.
Stop Loss: $134.28

source: mastertrader