DailyPlay – CL Bullish Opening Trade Signal – March 22, 2022

View CL Trade

Strategy Details

Strategy: Call Debit Spread

Strategy Direction: Bullish

Details: Buy to open April 29, 2022 $74/$78 Call Vertical @ $1.40 Debit

Counter Trend Signal: This is a bullish strategy on a stock or ETF that is experiencing a bearish trend. 

1M/6M Trends: Bearish/Bearish

Technical Score: 5/10

OptionsPlay Score: 111

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that if there is a multi-leg option strategy, it should be entered as a single trade.

Investment Rationale

This major consumer products name has gone nowhere for 18 months, but it has continuously traded from the top to the bottom of its range. It’s on its third weekly Setup -9 count of the consolidation, with the prior two nicely calling the bottoms. Last week made even a lower low to the range, but it now met its 200-WMA along with the lowest weekly RSI reading in years. We put that all together to make a bullish call here, buying the April 29th $74/$78 call vertical spread for a net cost of $1.40 based on Monday’s closing mid prices. We are paying about 35% of the $4 strike differential to make a max profit of $2.60.