Quick Take: One Day Wonder – Bullish Trade
Time Frame: One Day.
Underlying Stock: Bullish Market Edge Opinion – No Stock Position.
Desired Stock Price Direction: Up.
Option Position: Long Deferred ATM -1or -2 Call – Short Expiring ATM +1 or +2 Call.
Maximum Risk: Initial debit spread amount.
Summary: The stock performs as anticipated. The premium (air) is the short expiring call goes to zero while the long deferred call gains additional premium.
Quick Take: One Day Wonder – Bearish Trade
Time Frame: One Day.
Underlying Stock: Bearish Market Edge Opinion – No Stock Position.
Desired Stock Price Direction: Down.
Option Position: Long Deferred ATM +1 or +2 Put – Short Expiring ATM -1 or -2 Put.
Maximum Risk: Initial debit spread amount.
Summary: The stock performs as anticipated. The premium (air) in the short expiring put goes to zero while the long deferred put gains additional premium.
This Week’s One-Day Wonder Trades – Thursday
One-Day Wonder Trades, if any are posted on Thursday around 3:00 AM EST.
| Market Edge ‘Market Posture’ | Bearish | ||||||||
| Bullish – One-Day Wonder Horizontal Trade | Risk Capital | $20,000 | |||||||
| Market | Open | Short Call | Long Call | Open | % | ||||
| Open | Edge | Stock | 01/17/20 | 01/24/20 | Debit | 100% | Max | Risk Capital | |
| Stock | Date | Opinion | Price | Exp. Call | Def. Call | Spread | Target | Risk | Max Risk |
| BA | 01/16/20 | Bullish | $332.11 | 332.5 | 330.0 | $3.84 | $7.68 | $3.84 | 1.9% |
| $0.00 | $0.00 | 0.0% | |||||||
| Bearish -One-Day Wonder Horizontal Trade | |||||||||
| Market | Open | Short Put | Long Put | Open | % | ||||
| Open | Edge | Stock | 01/17/20 | 01/24/20 | Debit | 100% | Max | Risk Capital | |
| Stock | Date | Opinion | Price | Exp. Call | Def. Call | Spread | Target | Risk | Max Risk |
| XBI | 01/16/20 | Bearish | $96.71 | 96.5 | 98.5 | $1.82 | $3.64 | $1.82 | 0.9% |
| $0.00 | $0.00 | 0.0% | |||||||
| Def Option = Next Friday’s Expiration Serial | |||||||||
| Exp Option = This Friday’s Expiration Serial | |||||||||
| Prices Are Thursday Afternoon’s Around 3:00 PM | |||||||||
Results for this week’s trades will be posted over the weekend on the Scoreboard.