With the VIX (CBOE Volatility Index) closing at all-time lows, it is making it more difficult for us to find compelling short-term option selling candidates.

But rest assured we are looking!

Below is a daily chart of Overstock.com, Inc. (OSTK).

 

Below are some OTM Puts expiring 1/12/18 (16 DTE).  Because of the big spreads, we won't publish an official play, but if you can trade yourself, a volatility of 112% provides a great put/spread selling candidate with the bullish chart shown above.

 

Trade:  Consider shorting desired OTM puts/put spreads if you can get price improvement because of the huge spreads.  I personally will be trying two strategies.  I will try to get filled at “low offer” on a number of strikes by placing orders slightly below the offer price (so, if filled, is at great price improvement to mid-point).  I will also place a few bull put credit spread trades at much better prices than the defaulted “mid-point.”

Technical Setup:  Bullish +WRB from pullback after Bottoming Tail on r20MA daily, bullish engulfing weekly.

Option Strategy:   Bull Put Credit Spread (BPS).  112% Volatility makes for good credit spread trade.

Stop Loss:  $57.88.

Hope that helps!

 

Miscellaneous Member Documents and Reminders:

Adjustments and Comments on Open and Closed trades in Master Trader’s Weekly Options Trader. Note: Our Trade Updates are timely posted in a separate Report in the Member's Area. Please CLICK HERE to see that document for a current reflection on all Open and Closed Trades since the spreadsheet updates immediately and will always be more current than this e-mail update.

Please see Master Trader Guidelines for Trading the Open and Gaps in Member’s Area for rules on trade entry, gaps, etc.

 

Below is a link to individual videos explaining in greater detail the definitions of the main option trading strategies used by Master Trader in its advisory letters to generate wealth and income.

Description of Master Trader Directional and Income Option Trades can be seen HERE

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Adjustments and Comments on Open and Closed trades in Master Trader’s Weekly Options Trader. Note: Our Trade Updates are timely posted in a separate Report in the Member's Area. Please CLICK HERE to see that document for a current reflection on all Open and Closed Trades since the spreadsheet updates immediately and will always be more current than this e-mail update.

 

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To learn how to create Wealth and Generate Income using our simple Option Strategies, please see Master Trader Option Strategies Series for Investors and Active Traders.  Our unique approach is guaranteed to increase your ability to trade options with confidence with superior reward-risk that doesn’t take a lot of time.

 

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Happy trading!  If you have any questions or comments, please e-mail Greg Capra at Greg@mastertrader.com or Dan Gibby at Dan@mastertrader.com

All the best,

Greg Capra
Managing Director of Master Trader
Pristine’s Founder and Creator of the Pristine Method

Dan Gibby
Chief Options Strategist

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