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Overbought Call Spread Sale in GS

Home › Forums › Swing Trades › Overbought Call Spread Sale in GS

  • This topic has 1 reply, 1 voice, and was last updated 7 years, 4 months ago by Steven Place.
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  • February 12, 2015 at 2:41 pm #2298
    Steven Place
    Keymaster

    Great run in GS, but it’s running hot.

    gs

    The stock has rallied 7% in the past 10 days. That is statistically significant and tends to lead to consolidation. I’m not super bearish, I just think that further upside is lower odds than what the options are currently pricing in.

    Here’s the trade:

    Sell to open GS Apr 200/205 bear call spread for 0.93.

    If GS breaks above 193 I will roll the entire spread higher to the 205/210.

    If I can get 50% of the profit in under a month, I will take the profits there too.

    gs-risk

    March 6, 2015 at 9:36 am #2299
    Steven Place
    Keymaster

    We’re at 50% profits and it’s been under a month, time to take profits.

    Buy to close GS Apr 200/205 call spread @0.45

    If the spread gets back above .95 I will resell.

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