BAH MAR95/FEB17 DIAGONAL PUT
Bear Rally Set Up:
I've had BAH on my watchlist since the swing low it made on January the 20th. So I set an alert at 96.84 which was around the area of where it closed on January 9th. I wanted to see if this would run back up with lower or equal volume to test at least the 20-day again. With yesterday's candle and it trading below yesterday's low, it triggered me to get in. I also wanted to wait for earnings.
I drew a downward trendline from the high on November 10th down to Feb 17th. From the high of November 28th, to today, this stock touched that trend line multiple times which lead me to select the 90 strike expiring the 17th of February. This only had monthly expirations so if it doesn't make it to 90 by the 17th, I'll have that 95 strike until March.
Position management strategies when the stock goes lower
I've set an alert once this gets to 90. Once it reaches my target, I'll close out the combo.
Position management strategies when the stock goes sideways
If this goes sideways I'll let my 90 strike expire worthless and hang on to the 95 until March.
Position management strategies when the stock goes higher
If this climbs higher, Im set up for max loss risking less than 2% AUM.
Position management strategy at expiration
At expiration, if this is not trading at or below 90, I'll let my 90 expire worthless and hang on to my 95 strike until it hits my 90 target.
I've had BAH on my watchlist since the swing low it made on January the 20th. So I set an alert at 96.84 which was around the area of where it closed on January 9th. I wanted to see if this would run back up with lower or equal volume to test at least the 20-day again. With yesterday's candle and it trading below yesterday's low, it triggered me to get in. I also wanted to wait for earnings.
I drew a downward trendline from the high on November 10th down to Feb 17th. From the high of November 28th, to today, this stock touched that trend line multiple times which lead me to select the 90 strike expiring the 17th of February. This only had monthly expirations so if it doesn't make it to 90 by the 17th, I'll have that 95 strike until March.
Position management strategies when the stock goes lower
I've set an alert once this gets to 90. Once it reaches my target, I'll close out the combo.
Position management strategies when the stock goes sideways
If this goes sideways I'll let my 90 strike expire worthless and hang on to the 95 until March.
Position management strategies when the stock goes higher
If this climbs higher, Im set up for max loss risking less than 2% AUM.
Position management strategy at expiration
At expiration, if this is not trading at or below 90, I'll let my 90 expire worthless and hang on to my 95 strike until it hits my 90 target.
Trade active
Comment:
Letting my 90 strike expire worthless. Hanging on to my 95 strike.
Trade closed: target reached:
Im out.