Quick Take: Blow Off Bottom – Bullish Trade
Time Frame: Three To Seven Days.
Underlying Stock: Bullish Market Edge Opinion – No Position.
Desired Stock Price Direction: Up.
Option Position: Short Expiring ATM Put – Long Expiring ATM -2 Put (Credit Spread) & Long Deferred ATM +2 Call.
Desired Result: The stock performs as anticipated. The short expiring put credit spread expires worthless and the long call gains additional premium.
Maximum Risk: Initial Put Credit Spread minus the Deferred Call Debit.
Quick Take: Blow Off Top – Bearish Trade
Time Frame: Three To Seven Days.
Underlying Stock: Bearish Market Edge Opinion – No Position.
Desired Stock Price Direction: Down.
Option Position: Short Expiring ATM Call – Long Expiring ATM +2 Call (Credit Spread) & Long Deferred ATM -2 Put.
Desired Result: The stock performs as anticipated. The short expiring call credit spread expires worthless and the long put gains additional premium.
Maximum Risk: Initial Call Credit Spread minus the Deferred Put Debit.
Current Blow Off Trades
| Market Edge – ‘Market Posture’ | Bearish | |||||||
| Blow Off Bottom Horizontal Trade (Bullish) | ||||||||
| Open | *Short-Exp | *Long-Exp | Put | Long-Def | Deferred | |||
| Open | Stock | ATM Put | ATM -2 Put | Spread | ATM +2 Call | Call | Max | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Loss |
| RCL | 10/15/18 | $118.56 | 119.0 | 118.0 | $0.46 | 121.0 | $1.02 | $1.56 |
| PXD | 10/16/18 | $173.73 | 172.5 | 167.5 | $1.19 | 177.5 | $2.55 | $6.36 |
| Market Edge – ‘Market Posture’ | Bearish | |||||||
| Blow Off Top Horizontal Trade (Bearish) | ||||||||
| Open | *Short-Exp | *Long-Exp | Call | Long-Def | Deferred | |||
| Open | Stock | ATM Call | ATM +2 Call | Spread | ATM -2 Put | Put | Max | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Loss |
| NONE | ###### | |||||||
| * Next to symbol indicates that the stock selection is in its second week so the defered call or put is the same. | ||||||||
| ** Selections are made on Monday, Tuesday & Wednesday and have spreads with Friday’s expiration. | ||||||||
Results For Previous Week’s Blow-Off Trades
| Blow Off Bottom Horizontal Trade (Bullish) | |||||||||||
| Open | Close | Open | Close | Open | Close | ||||||
| Open | Stock | Close | Stock | P/L | Spread | Spread | Call | Call | P/L | Weekly | |
| Stock | Date | Price | Date | Price | Stock | Credit | Debit | Debit | Credit | Trade | P/L |
| $0.00 | $0.00 | $0 | $0 | ||||||||
| $0.00 | $0.00 | $0 | $0 | ||||||||
| $0.00 | $0.00 | $0 | $0 | ||||||||
| $0.00 | $0.00 | $0 | $0 | ||||||||
| Profit/Loss Blow Off Bottom Trades: | $0 | ||||||||||
| Weekly % Return: | 0.0% | ||||||||||
| Blow Off Top Horizontal Trade (Bearish) | |||||||||||
| Open | Close | Open | Close | Open | Close | ||||||
| Open | Stock | Close | Stock | P/L | Spread | Spread | Put | Put | P/L | Weekly | |
| Stock | Date | Price | Date | Price | Stock | Credit | Debit | Debit | Credit | Trade | P/L |
| DE | 10/08/18 | $154.93 | 10/12/18 | $148.42 | $6.51 | $1.02 | $0.00 | $1.84 | $5.15 | $433 | $433 |
| $0 | $433 | ||||||||||
| $0.00 | $0 | $433 | |||||||||
| $0.00 | $0 | $433 | |||||||||
| Profit/Loss Blow Off Top Trades: | $433 | ||||||||||
| Weekly % Return: | 2.2% | ||||||||||
| Total Risk Capital: | $20,000 | ||||||||||
| Total Profit/Loss: | $433 | ||||||||||
| Total Weekly % Return: | 2.2% | ||||||||||
| # Of | # Of | ||||||||||
| Win % | Loss % | % P/L | Annualized ROI | Trades | Weeks | ||||||
| 46.7% | 53.3% | 4.8% | 22.7% | 23 | 11 | ||||||