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) May 2024 $165-$170 in-the-money vertical BULL CALL spread at $4.00
Opening Trade
4-10-2024
expiration date: May 17, 2024
Portfolio weighting: 10%
Number of Contracts = 25 contracts
I am seeing quite a bullish selloff here with the hot inflation number coming in this morning.
Inflation isn’t going away.
Everyone and their mother know that by just looking at prices for stuff.
This is a highly orderly selloff with the likes of Meta and Spotify shares even on the day.
This CPI number doesn’t really move the needle and I will expect tech to launch into bullish mode after a quick consolidation.
Amazon is a name that I have wanted to get into for a while.
Look at their chart and it’s almost ideal.
Demand for the stock is insatiable.
Don’t pay more than $4.15.
Here are the specific trades you need to execute this position:
Buy to Open 25 May 2024 (AMZN) $165 calls at…………$22.50
Sell to short 25 May 2024 (AMZN) $170 calls at………….$18.50
Net Cost:……………………..…….………..……........................$4.00
Potential Profit: $5 - $4 = $1
(25 X 100 X $1) = $2,500 or 25% in 37 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.