Today 8/24/2018- I've entered a long position into Alaska Airlines (ALK) as the stock has been trading sideways for over 200 days and seems to have a strong support at 58$( average 60$ a share). There was an resistance zone at 64.00$ and it broke through it to 68$ and has now retrace back to 64.75$ a share which could now be a new support area. Not only is the price action trading sideways and now higher, but the moving averages are starting to curve higher. The RSI is also diverging with higher highs and higher lows (triangular wedge) and the stock should find a clear path forward soon. As I am trading options, I gave myself a long expiration till January 2019 but realistically, I would like to close this position for profit in a 3-6 weeks if this stock explodes higher. I would be interested to take profits when the stock goes to 70$ - 75$ a share.
I bought a vertical call spread 60$ call/ and 70$ call for a total price of 5.16$ a contract which is $516 dollars invested. There is earnings in 62 days and this gives me a good 2 months for the stock to go above 65.16$ and then this trade can make some money. When the stock goes to 70$ a share, this trade will make atleast 150$ and that is a 29% return for the stock to only go up 7% over 2 months.
I bought a vertical call spread 60$ call/ and 70$ call for a total price of 5.16$ a contract which is $516 dollars invested. There is earnings in 62 days and this gives me a good 2 months for the stock to go above 65.16$ and then this trade can make some money. When the stock goes to 70$ a share, this trade will make atleast 150$ and that is a 29% return for the stock to only go up 7% over 2 months.
Comment:
On September 7th, I sold my call spread for 594.00$ and profited 15.1% in two weeks.