AA Stepping stone after lengthy accumulationNYSE:AA currently in buy zone testing the bottom of new trading range (stepping stone) and demand trend line. Left the previous 9-year accumulation range on light volume, which provides confidence in underlying trend. The only concern is that materials sector and aluminium industry do not show any signs of market leadership. Good for range-bound trade or long-term investment.
AA1 trade ideas
Broken Call Butterfly Option On Weekly AA, ending on 6/22/18Symbol: AA Current: $ 44.47
Lower Wing:
Buy
Option: 22nd Jun $44.00 Call
Price per option: $ 0.93
Contracts: #1 x 100
Total cost: $93
Middle:
Write
Option: 22nd Jun $44.50 Call
Price per option: $ 0.65
Contracts: 2 x 100
Total cost: $130
Upper Wing
Buy
Option: 22nd Jun $49.00 Call
Price per option: $ 0.15
Contracts: #1 x 100
Total cost: $15
Entry cost: $22 (net credit)
Maximum risk: $378 at a price of $49 at expiry
Maximum return: $72 at a price of $44.50 at expiry
Breakevens at expiry: $45.20
AA To keep an eye onMassive gap to cover, but too rowdy out there so the target could be quietly good to buy at 43-42. I would be buying at that level if I see an opportunity.
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AA Do not get nervous, scenario to coverYou already know I'm out of this asset and this analysis is made just for a request. Keeping lines from the last idea on AA (by the way target reached), price into a range and risky if you want to trade in the very short term and don't have a clear strategy.
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Have a Good Trading Week,
Cream Live Trading, Best Regards!