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Nov 2019: AAPL $260- $250 Bear Put Spread

Stock

AAPL

Trade Structure

$260- $250 Bear Put Spread

Trade Date

11/09/2019

Expiration Days

12/06/2019

Trade Rationale

On Nov 6th, we put on an AAPL $257-$247 Bear Put Spread because all our indicators were pointing to an imminent market pullback. But after the "China Deal", the market kept roaring higher and higher. Since, our directional bias and analysis hasn't changed, I used this opportunity to put on a new $260-$250 Bear Put Spread for a debit of $312. If AAPL expires below or at $250 in 27 days, we will double our money. PS: Please reference the previous AAPL trade which we placed on Nov 6th: https://25koptionschallenge.com/nov-2019-aapl-257-247-bear-put-spread/

Trade Selection Criteria

Overall market movement

With S&P 500 making new all time highs, the overall market and practically every stock in my watchlist is making new highs. With the first signs of a loss in upward momentum, it is a great time to put on some mean reversion trades

No Earnings or Significant News

Earnings are behind us and were announced on 10/30. There is no significant news or earnings event during our trade cycle.

Bollinger Bands outside Keltner Channels

Bollinger Bands are outside Keltner Channels. We are not in a squeeze or low volatility period.

RSI Analysis

RSI has flattened out and is in the overbought zone. But not showing any clear signs of a pullback or trend reversal. 

ADX Analysis

ADX is still flat, indicating that the previous upward momentum has lost its strength.

Trade Analysis

Analysis will be updated, when we close the Trade

Trade Outcome

LOSER

Profit/Loss

$265

Beginning Account Balance

$18,000

Ending Account Balance

$

To follow along the strategies we use in the $25K challenge, we recommend that you get the strategy book which explains the whys and wherefores of our method. Get it here=> https://amzn.to/2MUOCE5

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