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Applied Materials (AMAT) price break out from the green signal line. Cash out the Jan $17.50 call for $3.00 or more depending on the opening prices Thursday. Doubled your money if you didn't roll in and out of these over the 2 months. The price action was very good for writing chicken spreads. Hold the puts till expiration; you might get a sharp sell off on Friday 13th.
Applied Materials (AMAT) total cost $1721 for 10 contracts Jan. 17.5 straddle Jan $17.5 calls cost 1.05 and Jan puts $17.5 cost .60 cents. The Jan $17.50 call popped to $2.00, which was the time to close them out to recover cost of the straddle. The Jan $1750 puts are $.20 cents, but may increase if institutional selling of the stock continues. AMAT'S stock price is being supported by the red signal line at $17. Time is running out on this straddle, so keep a close eye out for any sharp moves to the downside or upside. Your profit window on straddle is between $19 and above or $15 and below. Any price between $15 and $19 will expire at a modest lost of $600, but the stock has to close exactly at $17 on options expiration day. Hold position on both puts and calls, till Jan boom or bust move.
Currently this stock is testing the red signal line and may begin to break down to new lows below the start of the chicken straddle play in November. The Beta factor on this stock is at 2.66, too high to buy a "chicken straddle", but if you want to "write a chicken straddle" you might have some opportunities.
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