After two shakeouts this month, the market is back at its highs. Incredible resiliency. Until proven otherwise we need to assume that the trend is up.
I’ve mentioned the key level I was watching for resistance… the high of that big selloff right around 2465. We’re now above it, so it’s safe to assume that buyers have regained control of this market.
Trade #1: FDX
This is a classic pullback and base pattern. I thought it could manage to run to 200 and retest previous resistance, but that pullback was truncated and we’re running higher here. I like scaling in to put spreads.
Expected Price: 215
Sell to Open FDX Oct 200/195 Put Spread
Tier 1: Enter at 0.81, Exit at 0.31
Tier 2: Enter at 1.20, Exit at 0.80
No Tier 3, Will Look to Manage Around Earnings.
Trade #2: WYNN
Very similar setup to Fedex. The further pullback was truncated, and there was a volatility pivot to the upside, followed by a flag pattern. I’m expecting further highs.
Expected Price: 139
Sell to Open WYNN Oct 125/120 Put Spread
Tier 1: Enter at 0.55, Exit at 0.05
Tier 2: Enter at 0.85, Exit at 0.55
Tier 3: Enter at 1.15, Exit at 0.85