Quick Take: Blow Off Bottom – Bullish Trade
Time Frame: Three To Seven Days.
Underlying Stock: Bullish Market Edge Opinion – No Stock Position.
Desired Stock Price Direction: Up.
Option Position: Short Expiring ATM Put – Long Expiring ATM -2 Put (Bullish Put Credit Spread) & Long Deferred ATM +2 Call.
Maximum Risk: Initial Put Credit Spread minus the Deferred Call Debit.
Summary: The stock performs as anticipated. The short expiring put spread expires worthless and the long deferred call gains additional premium.
Quick Take: Blow Off Top – Bearish Trade
Time Frame: Three To Seven Days.
Underlying Stock: Bearish Market Edge Opinion – No Stock Position.
Desired Stock Price Direction: Down.
Option Position: Short Expiring ATM Call – Long Expiring ATM +2 Call (Bearish Call Credit Spread) & Long Deferred ATM -2 Put.
Maximum Risk: Initial Call Credit Spread minus the Deferred Put Debit.
Summary: The stock performs as anticipated. The short expiring call spread expires worthless and the long deferred put gains additional premium.
Current Blow Off Trades
| Market Edge – ‘Market Posture’ | Bullish | ||||||||
| Blow Off Bottom Horizontal Trade (Bullish) | |||||||||
| Open | *Short-Exp | *Long-Exp | Open | **Long-Def | Deferred | ||||
| Open | Stock | ATM Put | ATM -2 Put | Spread | ITM Call | Call | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| BABA | 02/11/19 | $168.82 | 170.0 | 165.0 | $1.22 | 162.5 | $8.00 | $6.78 | $13.56 |
| CVX | 02/11/19 | $116.75 | 117.0 | 115.0 | $1.00 | 114.0 | $3.08 | $2.08 | $4.16 |
| Blow Off Top Horizontal Trade (Bearish) | |||||||||
| Open | *Short-Exp | *Long-Exp | Open | **Long-Def | Deferred | ||||
| Open | Stock | ATM Call | ATM +2 Call | Spread | ITM Put | Put | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| $0.00 | $0.00 | ||||||||
| * Selections are made on Monday, Tuesday & Wednesday and have Exp positions with Friday’s expiration. | |||||||||
| **Selections are made on Monday, Tuesday & Wednesday and have Def Put/Call positions with next Friday’s expiration. | |||||||||
| Track Record | |||||||||
| Risk Capital—-> | $20,000 | ||||||||
| % | % Annualized | # Of | # Of | ||||||
| Win % | Loss % | P/L | P/L | Trades | Weeks | ||||
| 81.8% | 18.2% | 11.4% | 118.7% | 11 | 5 | ||||
Results for this week’s trades will be posted over the weekend on the Scoreboard.