DailyPlay (NKE) & Closing Trade (CC) – April 14, 2022

View NKE Trade

Closing Trades

• CC: 34.31% Loss:  Sell to close May 6, 2022 $29/$32 Put Vertical @ $0.67 Credit. Yesterday morning we covered half of our CC long put spread, and said that any subsequent close above $33.32 would have us exit the rest. It closed at $33.44 yesterday, and thus, I have no reason to hold this short, so we will cover the remainder of our long May 6th $29/$32 put spread this morning. The average loss on this trade was 24.05% and the average cost basis to exit this trade is $0.64 credit.

NKE Bullish Opening Trade Signal

Strategy Details

Strategy: Call Debit Spread

Strategy Direction: Bullish

Details: Buy May 27 $128/$140 Call Vertical @ $3.81 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: 4/10

OptionsPlay Score: 91

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

Monday and Tuesday both showed “Doji” candles (i.e., indecision) after a two-week decline. That came right against the bearish Propulsion Momentum level ($124.27) and the TDST Line ($123.70) while then also marking a daily Setup -9 count yesterday. That’s enough for us to play that this is a trading bottom, with me proposing a subsequent move up to near the late-March high of $140. As such, we will buy the May 27th $128 call and sell the $140 against it for $3.81 debit based on last night’s mid-closing price. NKE doe not report earnings till late June so that’s not a factor for our holding period. We are laying out about 32% of the spread differential on a counter-trend play that we needn’t stick around very long for if support breaks.