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.
Tech Alert - Amazon.com, Inc. (AMZN) – BUY
Buy Amazon.com, Inc. (AMZN) October 2023 $125-$130 in-the-money vertical BULL CALL spread at $4.10
Opening Trade
9-19-2023
expiration date: October 20, 2023
Portfolio weighting: 10%
Number of Contracts = 24 contracts
AMZN is down another 2.5% this morning as the NASDAQ index experiences a broad sell-off.
I am buying the dip here in AMZN as AMZN has solid technical support at the $135 level.
I do believe that there is a high likelihood of one more rotation into strong tech companies as we close the year.
There could be another bet on a Fed pivot as even though the economy is holding up, internal is indeed softening.
I do believe it is worth buying the dip in AMZN.
Here are the specific trades you need to execute this position:
Buy 24 October 2023 (AMZN) $125 calls at………….………$13.40
Sell short 24 October 2023 (AMZN) $130 calls at…….…….$9.30
Net Cost:…………………….......................…….………..…….....$4.10
Potential Profit: $5 - $4.10 = $.90
(24 X 100 X $.90) = $2,160 or 21.95% in 31 days
If you are uncertain on 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.