fbpx
‪(720) 819-5927‬ support@25koptionschallenge.com

Oct 2021: FB $325- $330 Bull Call Spread

Stock

FB

Trade Structure

$325-$330 Call Spread

Trade Date

10/26/2021

Price Paid

$250

Expiration Days

11/26/2021

THIS IS A DELAYED TRADE FOR EDUCATIONAL PURPOSES ONLY.

To participate in our live challenge and to access our online training, please click “Your Account” and upgrade to the “Live Trader” plan.

 

Trade Rationale

FB, GOOG and other social media ad-related companies had a nasty gap down on 10/21 when SNAP announced a huge earnings miss blaming it all on loss of ad-revenue due to IOS 14 privacy related changes. FB did beat eps estimates a few days later and I put this trade based on support around $325. But it kept dropping all the way down to $310 before recovering. The recent reorg and Meta news has turned the tables in our favor and this trade looks pretty decent at this point. Congrats to those who were able to get the trade at lower strikes!

Trade Selection Criteria

Overall market movement

This is a post earnings trade, the individual stock’s price movement is more important than the overall market.

N/A

No Earnings or Significant News

This is a post earnings trade and earnings were announced before market open

Bollinger Bands outside Keltner Channels

Bollinger bands are clearly outside Keltner Channels

RSI Analysis

Trade was taken purely based on price/action

N/A

ADX Analysis

Trade was taken purely based on price/action

N/A

Trade Analysis

Pretty crazy ride on this trade. I took this trade right after earnings after seeing price stabilizing around $325. However, the bottom literally fell out from under FB and it dropped all the way to $308 in the coming days. Although, we did close the trade out for a full profit today, but this highlights an important thing. I take all my trades based on the simple rules that I have laid out in my book. Some trades work out in my favor and some don't. I am not trying to pick all winners here (nor does any successful trader). The goal always is to have winners > losers in each expiration cycle. That is all it takes to become a profitable trader!

Trade Outcome

WINNER

Profit/Loss

$235

Beginning Account Balance

$24,100

Ending Account Balance

$23,500

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

Submit a Comment

Your email address will not be published.

Free no-obligation 7-day trial The Bull Run is just getting started...

The massive 5 month long correction is behind us and the Bull run is just getting started. Are you ready to take advantage of it?