AAPL weekly - 3/20 expiry 300 strike PUTS
Today these puts cost $3.30 (as I write this) with 52 days until expiration.
I am opening a small position since principal will be tied up for a while, and risk could be high.
RSI has touched 90 on the weekly chart.
Exit loss planning: 1) stock trade over today's high 2) stock trade over 330 in next 2 weeks 3)option value below a set value, depending on your loss tolerance 4) indicators no longer support trade plan
There can be multiple profit exit targets, based on daily chart: 1) stock at 310 2) stock at 10sma, then 20sma 3) stock in gap below 305
On weekly chart the 10 and 20 sma's are both below 300
Sample profit - If stock is 310 in 2 weeks, option value is around $7.60, a 100% gain.
I am opening a small position since principal will be tied up for a while, and risk could be high.
RSI has touched 90 on the weekly chart.
Exit loss planning: 1) stock trade over today's high 2) stock trade over 330 in next 2 weeks 3)option value below a set value, depending on your loss tolerance 4) indicators no longer support trade plan
There can be multiple profit exit targets, based on daily chart: 1) stock at 310 2) stock at 10sma, then 20sma 3) stock in gap below 305
On weekly chart the 10 and 20 sma's are both below 300
Sample profit - If stock is 310 in 2 weeks, option value is around $7.60, a 100% gain.
Trade active
With options, I am happy to take a high return on principal in short time. Putting in a limit order to close at $7 today if stock comes down to daily 20sma.Trade closed: target reached
Position closed at $7. Over 100% gain.Stock might drop lower (usually Monday follows Friday's action) but I don't have to "sit through" theta decay or IV drop now.
Trade happy, not greedy!
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.