MAR 2021: SQ $240 – $245 Bull Call Spread



Trade Structure

$240 - $245 Call Spread

Trade Date


Price Paid


Expiration Days



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Trade Rationale

SQ initially shot up from $247 to $261 on an earnings beat. However, it got dragged down with the market in the subsequent days. I took this trade on a support level which exists around $242ish. But the stock continued to fall after that giving many of our traders better entry points. If you missed this trade, it can be a good trade for next week.

Trade Selection Criteria

Overall market movement

N/A – This is a post earnings trade. Overall market movements are not as applicable as they are to our regular mean reversion trades

No Earnings or Significant News

This is a post earnings trade. Earnings were just announced on 2/23

Bollinger Bands outside Keltner Channels

Bollinger bands are clearly outside the Keltner Channels.

RSI Analysis

RSI is turning up

ADX Analysis

DI- although flat is now turning down.

Trade Analysis

SQ got brutally dragged down by the broader market sell off and although it almost recovered by 4/1 but not enough for us to recover my money on this trade. There are no guarantees in the stock market and deep corrections and pullbacks are part of the market cycles. The risk management and capital allocation rules that I teach our private members (also mentioned in my book) is what will save you from these corrections.

Trade Outcome




Beginning Account Balance


Ending Account Balance


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