Forex Stock Exchange Forum
Would you like to react to this message? Create an account in a few clicks or log in to continue.
Forex Stock Exchange Forum

Forum About Trading on Forex,Stock,Binary Options, CryptoCurrency and NFTs

Crypto Kong

You are not connected. Please login or register


Go down  Message [Page 1 of 1]

1RH (RH) Empty RH (RH) Tue Feb 28, 2017 10:04 am



RH (RH), $32.24.

[You must be registered and logged in to see this image.]

Trade:  We recommend selling 10 Apr $25/20 bull put spread (53 DTE) for $400 or better (current mid-point).
Technical Setup:  Pro Gap Breakout last Friday and bottoming weekly chart.

Option Strategy:   Bull Put Credit Spread. Defined risk strategy where you make maximum profit (net credit received) if the stock closes above the short put strike at expiration.  We sell put strike price below support where the pattern suggests that the stock will not close under at expiry, and simultaneously purchase lower strike put 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 higher strike price less credit received (i.e., also your cost basis if assigned the stock).  Considered a mildly bullish strategy since we are not buying calls or stock and just calling a short-term bottom 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: $24.88.

source: mastertrader

Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum