DailyPlay – Opening Trade (TLT) – January 3, 2023

TLT Bullish Opening Trade

View TLT Trade

Strategy Details

Strategy: Short Put Vertical Spread

Direction: Bullish

Details: Sell to Open 6 Contracts Feb 17th $100/$95 Put Vertical Spreads @ $1.85 Credit.

Total Risk: This trade has a max risk of $1,890 (6 Contracts x $315).

Counter Trend Signal: This is a Bullish trade on a stock that is experiencing a neutral to bullish trend.

1M/6M Trends: Bearish/Bearish

Technical Score: 3/10

OptionsPlay Score: 90

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. 

Please note that these prices are based on the previous day’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

Investment Rationale

UST 10-yr. bonds rallied XMAS week to where I have resistance pegged near 3.86%, so let’s look to sell a TLT Feb. 17th $100/$95 put spread for $1.85 credit, which represents a 37% differential between strikes. (With bond futures trading down as I write this Monday night, the TLT is now trading above $100, so we should actually be able to get a bit more for this spread than quoted based upon Friday’s closing mid prices.)

TLT – Daily