MRNA Support Bounce Weekly Option Play
Description
Today saw MRNA performing a high-volume bounce from the 224 support line which initiated the start of what appears to be a rough Descending Triangle.
I am bearish on MRNA for the longer term, but expect this upward move to continue throughout the week, along with the rest of the indexes that have seen a strong bounce today.
At the least, I am expecting a move up to touch the converging 50/200D EMA lines, and looking for a max expected move in the time frame of one week up to the higher strike @ 257.5 to take profits.
If the move is strong enough, we will let the position trade late into Friday to allow the spread to widen out to max profit potential, but I am willing to close the position early.
Using a call credit spread to reduce the price and due to expectations of an IV decrease throughout the week.
Call Credit Spread
Levels on Chart
SL: 224
PT : 257.5
*Stops based off underlying stock price, not mark to market loss
The Trade
BUY
1/14 235C
SELL
1/14 257.5C
R/R & Breakevens vary on fill.
If you can afford it, and have the conviction in the direction of MRNA, I would opt for a Call in conjunction with a Put Credit Spread. This will allow you realize profits much sooner in the case of a meteoric rise such as the one that occurred from 18 - 26 November.
Manage Risk
Only invest what you are willing to lose
Today saw MRNA performing a high-volume bounce from the 224 support line which initiated the start of what appears to be a rough Descending Triangle.
I am bearish on MRNA for the longer term, but expect this upward move to continue throughout the week, along with the rest of the indexes that have seen a strong bounce today.
At the least, I am expecting a move up to touch the converging 50/200D EMA lines, and looking for a max expected move in the time frame of one week up to the higher strike @ 257.5 to take profits.
If the move is strong enough, we will let the position trade late into Friday to allow the spread to widen out to max profit potential, but I am willing to close the position early.
Using a call credit spread to reduce the price and due to expectations of an IV decrease throughout the week.
Call Credit Spread
Levels on Chart
SL: 224
PT : 257.5
*Stops based off underlying stock price, not mark to market loss
The Trade
BUY
1/14 235C
SELL
1/14 257.5C
R/R & Breakevens vary on fill.
If you can afford it, and have the conviction in the direction of MRNA, I would opt for a Call in conjunction with a Put Credit Spread. This will allow you realize profits much sooner in the case of a meteoric rise such as the one that occurred from 18 - 26 November.
Manage Risk
Only invest what you are willing to lose
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