TheOptionPlayer.com sets up a S&P 500 Index (SPX) short-term (9-day) option strategy. Investors could simultaneously:
The difference between funds received and paid out is a $.60 per share credit which we keep if the S&P 500 index closes above $2310 on Friday April 26th but immediately exit the position if it appears the price will end up lower. If the price gaps lower open the trade using lower strike prices. See Guidelines page at www.theoptionplayer.com/ for explanation on how trade is set up.
Why we recommend it:
As confirmed in the daily chart below the S&P 500 index (SPX) has been confined in a trading range the past six weeks or so. Earning season has started out with a whimper because of disappointing numbers from some of the big names. Investors have gotten nervous over the strength of the domestic economy and waiting on the Republicans in Washington to deliver on a legislative agenda. Even with elevated volatility and lack of direction from the White House and Congress, investors thus far have refused a massive stock selloff. The chart confirms that trading momentum for the S&P 500 is neutral and the index remains above a support level established in the middle of February. There is a high probability the S&P 500 index will continue to trade above the target price for another week.
52-Week High: $2395.96
52-Week Low: $2000.54
The information presented here is for educational and informational purposes only, and this document is not to be construed as an offer to sell, or the solicitation of an offer to buy, securities. Some investments are not suitable for all investors, and there can be no assurance that any investment strategy will be successful.