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 - (QQQ) - BUY
BUY the Invesco QQQ Trust NASDAQ ETF (QQQ) March 2021 $330-$335 in-the-money vertical BEAR PUT spread at $4.40 or best
Opening Trade
3-4-2019
expiration date: March 19, 2021
Portfolio weighting: 10%
Number of Contracts = 24 contracts
We have decisively broken the 50-day moving average in the (QQQ) and lower levels beckon. The final target for this selloff could be the 200-day moving average at $283.
It is therefore prudent to hedge out some of the downside risks in my long stock holdings, especially in technology. After a meteoric move from March to August 2020, tech has been dead in the water. It now seems like capitulation is in order.
I am therefore buying the Invesco QQQ Trust NASDAQ ETF (QQQ) March 2021 $330-$335 in-the-money vertical BEAR PUT spread at $4.40 or best
Don’t pay more than $4.70 or you’ll be chasing.
Only use a limit order. DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
This is a bet that the Invesco QQQ Trust NASDAQ ETF S&P 500 (QQQ) will not trade above $335.00 by the March 19 option expiration day in 11 trading days. If the market gets that high in 11 days, you will think you have died and gone to heaven.
If you don’t do options, stand aside. This is a very short-term options expiration play only.
Here are the specific trades you need to execute this position:
Buy 24 March 2021 (QQQ) $335 puts at………….…...……$29.00
Sell short 24 March 2021 (QQQ) $330 puts at………..….$24.60
Net Cost:………………………….………..………….............….....$4.40
Potential Profit: $5.00 - $4.40 = $0.60
(24 X 100 X $0.60) = $1,440 or 13.63% in 11 trading 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.
