As expected, AAPL saw volatility expansion. It’s now up 4 days in a row and is breaking above a key level of resistance.
There’s a couple ways to manage the trade.
First, you can bail completely. Straddle profits can be incredibly short lived, especially if the stock sees any kind of reversion.
Second, you can scale and trail. This is where you exit out half of the trade and then bail on the rest if the stock loses its trendline… or puts in a higher low. This is the technique I’ll be using and will sell some here at 9.60 and if the stock loses 101.25 then I’ll bail.
Third… and I don’t think this is appropriate for this trade but I’ll discuss it so you can learn… you could sell calls against your straddle position. This would reduce the risk in your trade in exchange for capping off your gains. You could also short stock here to scalp the gamma in the trade. Refer to the video training about gamma scalping to see what I mean.