Swing Trade or Weekly 138 PUTS - low cost, low risk trade
This trade does not have strong signals for puts. Price is at top of cloud and 10sma is over 20, but 20sma has crossed below 50 (yellow arrow). RSI dipped below 50 on 2/18 and is back over today, which is bullish. If stock turns then RSI and Stochastic will both dip below 50 (green arrows)
That said, today's Fed minutes or any economic news (credit bubble, rates, repo lending, etc.) may cause selling after a strong run up and some claim stocks are "propped up" right now. I am keeping stock on watch list for a swing trade.
I opened weekly 137 puts at 37cents, and I exit position if stock trades over 138.50. Keep trade size small. If I hold overnight and stock opens higher I still lose only a small bit of principal. If stock drops back to 20sma or to recent gap, my return on capital will easily be over 100%.
That said, today's Fed minutes or any economic news (credit bubble, rates, repo lending, etc.) may cause selling after a strong run up and some claim stocks are "propped up" right now. I am keeping stock on watch list for a swing trade.
I opened weekly 137 puts at 37cents, and I exit position if stock trades over 138.50. Keep trade size small. If I hold overnight and stock opens higher I still lose only a small bit of principal. If stock drops back to 20sma or to recent gap, my return on capital will easily be over 100%.
Comment:
Sold puts at $0.50. With 30m SMA upward I decided to take a little profit.