"This trade was impressive because we turned a non-performer into a winner with a call spread." Bryan Bottarelli, Head Trade Tactician, Monument Traders Alliance Last week, I mentioned Costco (COST) was on my radar for a trade in The War Room. But here's the thing… This trade actually wasn't working out. You see… back in June I got positioned on COST on a call spread. But COST had been trading sideways for months. While this might've been a sign to cut my losses, the beauty of the call spread is it gives you the flexibility to roll into another month. So to keep the hopes of a winning trade alive, I rolled our October calls into a new December call. COST was nearing its $900 support level. So I knew if COST could fill the gap around $940, the trade would become a winner. Then yesterday, the Wall Street Journal reported COST sales were climbing in September and early October. This gave us the bounce we were looking for. COST moved up over $940, and the trade became a winner. This is a good example of how call spreads can turn a non-performing trade into a winning trade by executing a roll. Several War Room members were in on the trade. Here's what they had to say… |
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