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 - (XOM) – BUY
BUY the ExxonMobile (XOM) December 2023 $97-$100 in-the-money vertical Bull Call spread at $2.45 or best
Opening Trade
11-22-2023
expiration date: December 15, 2023
Portfolio weighting: 10%
Number of Contracts = 40 contracts
I think the market hugely overreacted to the postponement of the OPEC Plus meeting this weekend, which sent the options and futures market into turmoil. There were a large number of expiration due the following day on Monday.
In any case, I believe the US economy is headed for a modest slowdown, not a recession, which the crude markets seem to be indicating. I doubt we get below $68 a barrel, and (XOM) shares under $100 in the current cycle. Also, since the United States is a net energy exporter, American oil companies are less sensitive to foreign oil price gyrations.
I am therefore buying the ExxonMobile (XOM) December 2023 $97-$100 in-the-money vertical Bull Call spread at $2.45 or best.
Don’t pay more than $2.70 or you’ll be chasing.
DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
Simply enter your limit order, wait five minutes, and if you don’t get done cancel your order and increase your bid by 5 cents with a second order.
ExxonMobil Corporation is an American multinational oil and gas corporation and the largest direct descendant of John D. Rockefeller’s Standard Oil Company. The firm, which took its present name in 1999 per the merger of Exxon and Mobile Oil, is vertically integrated across the entire oil and gas industry.
Within it is also a chemicals division which produces plastic, synthetic rubber, and other chemical products. ExxonMobil is headquartered near the Houston suburb of Spring, TX, though officially incorporated in New Jersey.
This is a bet that ExxonMobile (XOM) will not fall below $100 by the December 15 option expiration day in 16 trading days. For more about (CAT) please click here for their website at https://www.mobil.com/en
Here are the specific trades you need to execute this position:
Buy 11 December 2023 (XOM) $97 calls at………….……...…$7.50
Sell short 11 December 2023 (XOM) $100 calls at………....$5.05
Net Cost:……………………..…….………..………….............….....$2.45
Potential Profit: $3.00 - $2.45 = $0.55
(40 X 100 X $0.55) = $2,200 or 22.45% in 16 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.
