- This topic has 1 reply, 1 voice, and was last updated 6 years, 10 months ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
Become a Great Options Trader
Home › Forums › Proactive Trade Setups › Retracement Short in FDX
Setup: Retracement Short
Price: 161
Description:
That was a pretty convincing breakdown from the support levels right around 155. As it stands right now, the stock is technically broken.
However, I think the early shorts are going to be punished. The clear support at 155 will have too many people selling calls against longs, and closing out their positions… but odds are there won’t be any good followthrough to the downside.
If we can squeeze up to the next resistance level at 161, that’s where I get interested. That would be enough of a move higher to get the hope back into the stock, and it makes for a decent entry point for some bear call spreads.
This does have earnings risk so ideally we are out before that event.
If you want to get cute… you could try to go long those calls into the 161 level and then flip the position.
The trade has hit our price levels, but too much time has gone on to get a good credit out of August options.
This upcoming monday will have the Sep options board open up, and I’ll look to use those to sell call spreads into.