FB just made a parabolic move to the upside and it may be starting a descent. Since the daily strength is to the upside and all major moving averages showing strength in FB, we didn't wanted to buy outright puts as we might get hit by decay. Instead, we initiated a bear call spread to collect premium if the stock stays below 31 for this week. We may also have some good time to close the position if the stock goes against us.
Trade:
Sell (1) 31 Calls
Buy (1) 32 Calls
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| 5 min chart showing some weakness in the stock today and how it closed below 23.6 fib level. |
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| Hourly chart shows weakness at close. Need confirmation. |
Have a good day, trade smart and let us know your thoughts.
*Please do your own research before buying any stock listed here. Disclaimer.
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