DailyPlay – Partial Closing Trade (ADM) – March 30, 2023

Partial Closing Trade

• ADM – 38.95% Gain: Buy to Close 4 Contracts (or 30% of your Contracts) April 21st $77.50/$75 Put Vertical Spreads @ $0.58 Debit. DailyPlay Portfolio: By Closing 4 of the 14 Contracts, we will be paying $232.

Investment Rationale

Stocks rose along with the Regional Bank Index (KBE) rising 0.6%, giving investors a sense that the worst is over from the potentially short-lived banking crisis earlier this month. The SPX gained 1.4%, while the NDX added 1.9% and the Russell 2000 tagged on 1.1%. All 11 sectors were higher, led by REITs and Technology. Health Care was again the laggard, as it has been so often this year.

The SPX closed right on its downtrend line from the early Feb. high. A push through it should lead to additional follow-through buying, likely pushing the index back to right near that Feb. high. (Notice the two unrelated targets at 4148 and 4161 in the green rectangle.)

SPX – Daily

Moreover, with Tuesday having been a down close and yesterday and up one above the bullish Propulsion Momentum level (3985), a higher open/higher high/higher close today (vs. yesterday) confirms this signal with a 4161 target.

We are long IWM as a hedge vs. our bearish QQQ trade. I have previously stated that a QQQ close above $315.25 (today or any other day) will have us exit the short call spread we have on. So, watch for that to potentially occur any day now.

QQQ – Daily

We’re short 14 ADM April 21st $77.5/$75 put spreads. Price is virtually on the minor downtrend line, but also close to getting a real upside breakout, too. As such, let’s just be smart and remove 4 of the 14 put spreads today to lock in the 39% profit we have on a portion of our position.

ADM – Daily