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Full Time Profits, February 19th, 2018 – GOOGL

February 19, 2018 By Steven Place


After nearly 2 years of grinding higher action, we’re finally back in a market that is a little more tradeable with credit spreads.

Last week we saw a strong selloff down to the 200 day moving average, which was actually a test of the overnight low in the futures market. It’s possible that we go back and retest that level, but you’ll need to see many of the large cap leaders finally give up on their uptrends… and that’s not something that I’ve seen recently.

Still, the strength of this bounce will most likely be faded as we approach the 2800 level. Enough technical damage was done that we don’t need to assume that “up” is the only way the market can go now.

If you sold put spreads into the big move lower, you should be scaling out of those positions already. You can then use any further downside vol to reload on those positions again or look at new setups when they manifest.

And if we squeeze just a bit higher, it’ll be a great area to start putting on call credit spreads. We’ve already discussed these in newsletters past, so you can go to the archives and see the setups available for that push.

Trade #1: GOOGL

Any further push is a good risk/reward short. There was a large gap down after earnings that will have more sellers come in.

Trade Setup

Expected Price: 1105

Sell to Open GOOGL 1200/1220 Call Spread

(This is a 20-wide spread. The 1210 option should open on Tuesday so you can do a similar trade and cut the prices in half.)

Tier 1: Enter at 3.00, Exit at 1.00

Tier 2: Enter at 4.00, Exit at 2.00

Tier 3: Enter at 5.00, Exit at 3.00

Disclaimer

U.S. GOVERNMENT REQUIRED DISCLAIMER – COMMODITY FUTURES TRADING COMMISSION. FUTURES AND OPTIONS TRADING HAS LARGE POTENTIAL REWARDS, BUT ALSO LARGE POTENTIAL RISK. YOU MUST BE AWARE OF THE RISKS AND BE WILLING TO ACCEPT THEM IN ORDER TO INVEST IN THE FUTURES AND OPTIONS MARKETS. DON’T TRADE WITH MONEY YOU CAN’T AFFORD TO LOSE. THIS WEBSITE IS NEITHER A SOLICITATION NOR AN OFFER TO BUY/SELL FUTURES OR OPTIONS. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED ON THIS WEBSITE. THE PAST PERFORMANCE OF ANY TRADING SYSTEM OR METHODOLOGY IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY, SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN

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