JUN 2021: AMGN $232.5 – $237.5 Bull Call Spread
Stock
ADSK
Trade Structure
$232.5- $237.5 Call Spread
Trade Date
6/1/2021
Price Paid
$250
Expiration Days
7/2/2021
THIS IS A DELAYED TRADE FOR EDUCATIONAL PURPOSES ONLY.
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Trade Rationale
This is a very simple mean-reversion trade. A massive red candle on 6/1 on literally no news caught my attention. There is clear support around 232 and DI- had been pointing down for a few days. When I took this trade, RSI hadn’t caught up yet, but is confirming my directional bias now as well.
Trade Selection Criteria
Overall market movement
May sell-off is behind us and markets are in decent shape. There is no exaggerated movement in the overall markets and this trade is based on purely this stocks own movement.
No Earnings or Significant News
Earnings are behind us and were announced on 4/27
Bollinger Bands outside Keltner Channels
Bollinger bands are clearly outside Keltner Channels.
RSI Analysis
RSI is pointing up giving this trade more conviction
ADX Analysis
DI- and DI+ are both reversing directions. This is a very text-bookish trade. Don’t see many of these in real life.
Trade Analysis
Not many trades play out like the text-bookish example this was. Perfect entry at the bottom of the Bollinger bands followed by a perfect exit at the top. Not much to say here 🙂
WINNERS THIS WEEK
Trade Outcome
WINNER
Profit/Loss
$235
Beginning Account Balance
$11,650
Ending Account Balance
$15,100
