Trade Alert - (PANW) September 27, 2022

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 - (PANW) – BUY

BUY the Palo Alto Networks (PANW) October 2022 $130-$140 vertical BULL CALL spread at $8.80 or best

Opening Trade

9-27-2022

expiration date: October 21, 2022

Portfolio weighting: 10%

Number of Contracts = 12 contracts

If you can’t do options, buy the stock. My long-term target for (PANW) is $300, up from today’s $163.17.

Palo Alto Networks is the class act in the cybersecurity space. Virtually every manager I know either has the stock or is trying to get into it.

Its total addressable market is a staggering $75 billion. As I never tire of pointing out to followers, hacking never takes a break, is always growing, and is recession-proof.

We have a rare opportunity to get into the stock down 25% from its all-time high. (PANW) is one of the toughest stocks to buy in the market. Everyone wants it. We also have an equally rare opportunity to get into the spread with a Volatility Index (VIX) at a sky-high $33.

Therefore, I am buying the Palo Alto Networks (PANW) October 2022 $130-$140 vertical BULL CALL spread at $8.80 or best.

Don’t pay more than $9.40 or you will be chasing.

This is a bet that the (PANW) will not fall below $140.00 by the October 21 options expiration in 19 trading days.

Here are the specific trades you need to execute this position:

Buy 12 October 2022 (PANW) $130 calls at………….………$34.00

Sell short 12 October 2022 (PANW) $140 calls at……….…$25.20

Net Cost:…………………………...............………..………….….....$8.80

Potential Profit: $10.00 - $8.80 = $1.20

(12 X 100 X $1.20) = $1,440 or 13.63% in 19 trading days.

If you are uncertain about how to execute an options spread, please watch my training video by clicking here.

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 on expiration months farther out.

Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.