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 | ||||||||
| Bullish – Blow Off Bottom Horizontal Trades | Risk Capital | $20,000 | |||||||
| Combo | Combo | Combo | Total | ||||||
| Open | Short Put | Long Put | Long Call | Combo | % | ||||
| Open | Stock | 11/01/19 | 11/01/19 | 11/08/19 | Spread | 100% | Max | Risk Capital | |
| Stock | Date | Price | Strike Price | Strike Price | Strike Price | Cost | Target | Risk | Max Risk |
| NONE | 11/04/19 | $0.00 | 0.0 | 0.0 | 0.0 | $0.00 | $0.00 | $0.00 | 0.0% |
| $0.00 | $0.00 | 0.0% | |||||||
| $0.00 | $0.00 | 0.0% | |||||||
| Bearish – Blow Off Top Horizontal Trades | |||||||||
| Combo | Combo | Combo | Total | ||||||
| Open | Short Call | Long Call | Long Put | Combo | % | ||||
| Open | Stock | 11/08/19 | 11/08/19 | 11/15/19 | Spread | 100% | Max | Risk Capital | |
| Stock | Date | Price | Strike Price | Strike Price | Strike Price | Cost | Target | Risk | Max Risk |
| UTX | 11/04/19 | $147.73 | 148.0 | 150.0 | 150.0 | $2.86 | $5.72 | $4.86 | 2.4% |
| JPM | 11/04/19 | $128.98 | 129.0 | 131.0 | 132.0 | $2.65 | $5.30 | $4.65 | 2.3% |
| FDX | 11/05/19 | $165.77 | 165.0 | 167.5 | 170.0 | $5.48 | $10.96 | $7.98 | 4.0% |
Results for this week’s trades will be posted over the weekend on the Scoreboard.