DailyPlay – Opening Trade (WHR) Closing Trade (WHR) – July 28, 2023

Closing Trade

WHR – 31.36% Gain: Sell to Close 4 Contracts (or 100% of your Contracts) Aug 11th $149 Puts @ $7.75 Credit. DailyPlay Portfolio: By Closing all 4 Contracts, we will receive $3,100.

WHR Bearish Opening Trade Signal

View WHR Trade

Strategy Details

Strategy: Long Put Vertical Spread

Direction: Bearish

Details: Buy to Open 3 Contracts Sept 15th $145/$130 Put Vertical Spreads @ $5.85 Debit per contract.

Total Risk: This trade has a max risk of $1,755 (3 Contracts x $585) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $585 to select the # shares for your portfolio.

Trend Continuation Signal: This is a bullish trade on a stock that has been bullish and is expected to break higher.

1M/6M Trends: Bearish/Neutral

Technical Score: 4/10

OptionsPlay Score: 111

Stop Loss: @ $2.93 Credit (50% loss).

Entering the Trade

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

Please note that these prices are based on Thursday’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

Reviewing our open positions we see that WHR has continued to trend lower after reporting earnings and its 1m/6m trend have started to turn bearish. Now is a good time to adjust this position and roll the position to a Put Vertical spread and potentially profit from further downside. This locks in a profit on this trade and allows us to seek further downside exposure while risking a very small dollar amount. Sell to Close all 4 Contracts of the Aug $149 Puts @ $7.75 Credit and taking the proceeds to Buy the Sept $145/$130 Put Vertical @ $5.85 Debit. With a hypothetical portfolio of $100,000 we recommend risking 2% of it on this trade, which is 3 Contracts for a total risk of $1,755. Set a stop loss on the spread when losses exceed 50% of the premium paid, at about $2.90 Credit. With this roll, even if the put spread is stopped out, we will risk a total of roughly $140, with a potential profit of about $2,700 if WHR is below $130 at the Sept expiration. 

WHR – Daily