JUL 2021: WDAY $225- $230 Bull Call Spread
Stock
WDAY
Trade Structure
$225- $230 Call Spread
Trade Date
07/20/2021
Price Paid
$250
Expiration Days
8/20/2021
THIS IS A DELAYED TRADE FOR EDUCATIONAL PURPOSES ONLY.
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Trade Rationale
A picture-perfect mean reversion trade! You will find these trades documented in my book too. All our mean reversion indicators are in place with this trade. DI- turning down, DI+ turning up, RSI turning up, plus the stock bouncing at support. A green candle after a DOJI. Literally every single box can be checked on this trade. These picture perfect trades don’t show up often, but they do come around every now and then.
Trade Selection Criteria
Overall market movement
There was a brief pullback in Nasdaq which generated several trading opportunities
No Earnings or Significant News
Earnings are behind us and were announced on 5/26
Bollinger Bands outside Keltner Channels
Bollinger bands are clearly outside Keltner Channels.
RSI Analysis
RSI sharply turning up.
ADX Analysis
DI+ is sharply turning up and DI- is turning down
Trade Analysis
At the time of opening the trade, this looked like a great trade. However, WDAY got stuck in a sideways consolidation phase and chopped around in a tight trading zone throughout the trading window. This accompanied with the pullback in the market last week, forced me to get out of this trade at 53% ROI instead of the usual 94% which I shoot for.
Trade Outcome
WINNER
Profit/Loss
$133
Beginning Account Balance
$15,200
Ending Account Balance
$14,700
