Nasty, nasty move in NFLX. This sometimes happens with our bull put spreads, expecially when I call the trade a “knife catch.”
What we will do now is roll the spread to lower strikes. This is known as a “condor roll” and will increase our odds in exchange for less reward and more risk.
Here’s the trade:
Buy 345/340 320/315 put condor for .75.
Here is the thinkorswim ticket:
BUY +1 CONDOR NFLX 100 MAY 14 345/340/320/315 PUT @.76 LMT
Now.. if you can get filled on this trade outright that’s great, but you may need to break it up. To do that, you will have 2 separate trades:
Buy to close May 345/340 bull put spread
Sell to open 320/315 bull put spread
I now have a hard stop at 318, which is just under major support from January.
