Internals Weakening
Sell CTRP Calls
PLAY: Sell your CTRP October 60 Calls (QCT JL) at market, good for the day.
Dear Bottarelli Research Member,
It’s been an up-and-down session thus far, with the major market averages bouncing between gains and losses. Within the first hour, we used an up-tick in Green Mountain Coffee Roasters (GMCR – NASDAQ) to lock in a nice 42% gainer. This trade certainly moved fast, but that’s often times the case in today’s market. I’ve been repeatedly saying that we must remain quick and nimble, and this trade was a prime example. For those who pegged this one, congratulations on a very nice trade!
Looking at our open positions, we’re now left holding MOS October 50 Puts (MOS VJ) and the CTRP October 60 Calls (QCT JL). In terms of MOS, I feel that the stock will soon fill the gap left by yesterday’s opening-session pop. Therefore, maintain your puts for more gains.
On the flip-side, I’m slightly concerned that CTRP will be unable to break out to a new high, thus creating a double-top formation at $60.00. Today’s black candlestick formation, combined with weak market internals (and a U.S. dollar that’s now ticking up), has made the decision easy. That is, let’s take the safe route. As you know, we entered the CTRP October 60 Calls (QCT JL) for $1.80, and they’ve now traded up to $2.00 in today’ session. Let’s exit the position now, while we still have a slight gain, and look for better (and safer) opportunities. This is the most prudent action.
PLAY: Sell your CTRP October 60 Calls (QCT JL) at market, good for the day.
As always, I’ll follow up on other positions as the trading day progresses.
But until then…
Lock and load!
Sincerely,
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