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 | 06/21/19 | 06/21/19 | Spread | 06/28/19 | Long Call | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| BABA | 06/17/19 | $158.81 | 160.0 | 157.5 | $1.16 | 155.0 | $6.65 | $5.49 | $10.98 |
| ADBE | 06/18/19 | $278.46 | 277.5 | 280.0 | $1.35 | 282.5 | $9.10 | $7.75 | $15.50 |
| CVX | 06/18/19 | $122.72 | 122.0 | 124.0 | $0.98 | 126.0 | $3.55 | $2.57 | $5.14 |
| Blow Off Top Horizontal Trade (Bearish) | |||||||||
| Open | Short Call | Long Call | Long Put | ||||||
| Open | Stock | 06/21/19 | 06/21/19 | Spread | 06/28/19 | Long Put | Total | 100% | |
| Stock | Date | Price | Strike Price | Strike Price | Credit | Strike Price | Debit | Cost | Target |
| TLT | 06/17/19 | $131.25 | 131.0 | 133.0 | $0.68 | 133.0 | $2.20 | $1.52 | $3.04 |
| $0.00 | $0.00 | ||||||||
Results for this week’s trades will be posted over the weekend on the Scoreboard.