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 Put | Long Put | Long Call | ||||||
| Open | Stock | 05/17/19 | 05/17/19 | Spread | 05/24/19 | Long Call | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| TSLA | 05/13/19 | $226.62 | 225.0 | 222.5 | $0.95 | 220.0 | $13.10 | $12.15 | $24.30 |
| CAT | 05/14/19 | $126.19 | 126.0 | 124.0 | $0.67 | 124.0 | $4.15 | $3.48 | $6.96 |
| FDX | 05/14/19 | $172.23 | 172.5 | 170.0 | $0.96 | 167.5 | $6.80 | $5.84 | $11.68 |
| Blow Off Top Horizontal Trade (Bearish) | |||||||||
| Open | Short Call | Long Call | Long Put | ||||||
| Open | Stock | 05/17/19 | 05/17/19 | Spread | 05/24/19 | Long Put | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| NONE | 05/13/19 | $0.00 | 0.0 | 0.0 | $0.00 | 0.0 | $0.00 | $0.00 | $0.00 |
| $0.00 | $0.00 | ||||||||
| Track Record | |||||||||
| Risk Capital—-> | $20,000 | ||||||||
| % | Annualized | # Of | # Of | ||||||
| Win % | Loss % | P/L | P/L | Trades | Weeks | ||||
| 61.4% | 38.6% | 20.4% | 58.9% | 45 | 18 | ||||
Results for this week’s trades will be posted over the weekend on the Scoreboard.