MAR 2021: TGT $172.5 – $177.5 Bull Call Spread
Stock
TGT
Trade Structure
$172.5- $177.5 Call Spread
Trade Date
3/2/2021
Price Paid
$250
Expiration Days
04/09/2021
THIS IS A DELAYED TRADE FOR EDUCATIONAL PURPOSES ONLY.
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Trade Rationale
Massive red candle on an earnings beat? Another reason why I don’t put trades on when earnings are coming up. TGT got pulled down with the market and I entered the 172.15 - 177.5 spread when TGT was around 174. I did this based on the clear support at $175ish level. TGT got pulled further down as the entire market was in a free fall, and has recovered since.
Trade Selection Criteria
Overall market movement
Nasdaq has been in a massive correction the entire month of March. Making use of the deep discount that every stock is trading at this time.
No Earnings or Significant News
N/A
Bollinger Bands outside Keltner Channels
Bollinger bands are clearly outside the Keltner Channels.
RSI Analysis
RSI is in over-sold territory and not showing any clear signals. However, support/resistance and ADX are supporting this trade.
ADX Analysis
DI- is pointing down. In addition to this the clear support at $110 is a factor for taking this trade.
Trade Analysis
Target kept falling initially all the way down to $166, giving our members many opportunities to enter it at lower strikes. However, it reversed after 5 days and just took off to the races. We were able to close this for our full profit target in 24 short days.
Trade Outcome
WINNER
Profit/Loss
$235
Beginning Account Balance
$13,018
Ending Account Balance
$10,200
Hi, for this TGT trade, what date did the entry take place?
Please read the post. All the information is there.
thank you so much for the teaching!, I have went over your book so many time, absolutely great book! just wandering if the trade date above on TGT at 3/29/2021 is accurate? because I see on the chart its around 3/02/2021 when the price hits 175ish. really appreciate the response. thank you!
Fixed the typo. The correct date is 3/2
I think there may be an error in your stated entry date. In the blue box at the top you state the entry as 3/29/21. But in your write up you talk about holding the trade for 24 days. I’m wondering if you took this trade in February.
Thanks. Fixed the date. The trade open date was 3/2/2021