Tech Trade Alert - (SQ) April 9, 2018 BUY
When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Trade Alert - (SQ) - BUY
BUY the Square (SQ) June, 2018 $35-$40 in-the-money vertical BULL CALL spread at $4.00 or best
Opening Trade
4-9-2018
expiration date: June 15, 2018
Portfolio weighting: 10%
Number of Contracts = 25 contracts
The real call here is that the NASDAQ has entered a well-defined trading range, from 6,600 to 7,600, where it will remain trapped for six months until the November midterm congressional elections. After that, we will rally 10% in yearend rally.
The deep in-the-money call spread strategy I employ is ideally suited to this kind of go nowhere market. While other traders are tearing their hair out, you'll be raking in the money every month as if you've just been adopted by a new rich uncle.
Square continues to make great strides in fintech, being the first company to accept bitcoin for online payments.
Don't pay more than $4.25 for this position or you'll be chasing.
If you don't do options, close your eyes and buy Square shares outright. They easily have another double in them.
For more detail about the long term business prospects for Square, please read "A Straight Line to Profits With Square"?by clicking here.
Here are the specific trades you need to execute this position:
Buy 25 June 2018 (SQ) $35 calls at...............$12.75
Sell short 25 June 2018 (SQ) $40 calls at............$8.75
Net Cost:....................................................$4.00
Potential Profit: $5.00 - $4.00 = $1.00
(25 X 100 X $1.00) = $2,500 or 25% in 50 trading days.
To see how to enter this trade in your online platform, please look at the order ticket above, which I pulled off of Interactive Brokers.
If you are uncertain on how to execute an options spread, please watch my training video on How to Execute Vertical Call and Put Debit Spreads by clicking here.
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Please keep in mind that these are ballpark prices only. There is no telling how much the market can move by the time you get this.
Be sure you've signed up for our FREE text alert service. When seconds count, this feature offers a trading advantage. In today's market, investors need every advantage they can get.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you.
The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don't execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile close to expiration.
If you don't get done, don't worry. There are another 250 Trade Alerts coming at you over the coming 12 months.