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’ | Neutral | ||||||||
| Blow Off Bottom Horizontal Trade (Bullish) | |||||||||
| Open | Short Put | Long Put | Long Call | ||||||
| Open | Stock | 04/12/19 | 04/12/19 | Spread | 04/18/19 | Long Call | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| TSLA | 04/08/19 | $277.91 | 277.5 | 275.0 | $1.05 | 275.0 | $9.90 | $8.85 | $17.70 |
| BA | 04/09/19 | $369.57 | 370.0 | 367.5 | $1.10 | 362.5 | $11.50 | $10.40 | $20.80 |
| Blow Off Top Horizontal Trade (Bearish) | |||||||||
| Open | Short Call | Long Call | Long Put | ||||||
| Open | Stock | 04/12/19 | 04/12/19 | Spread | 04/18/19 | Long Put | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| CVX | 04/08/19 | $126.95 | 127.0 | 129.0 | $0.76 | 129.0 | $2.45 | $1.69 | $3.38 |
| FB | 04/10/19 | $177.20 | 177.5 | 180.0 | $0.88 | 182.5 | $5.80 | $4.92 | $9.84 |
| Track Record | |||||||||
| Risk Capital—-> | $20,000 | ||||||||
| % | Annualized | # Of | # Of | ||||||
| Win % | Loss % | P/L | P/L | Trades | Weeks | ||||
| 61.3% | 38.7% | 20.1% | 74.8% | 32 | 14 | ||||
Results for this week’s trades will be posted over the weekend on the Scoreboard.