Taking Partial Profits

• TAN: 48.8% Gain: Buy to close Apr 22, 2022 $66/$74 Put Vertical @ $1.70 Debit. Close half of this position. For example, if 4 contracts were opened for this trade, we recommend closing 2 contracts. 

Closing Trades

• C: 88% Loss: Sell to close May 20, 2022 $62.5 Call @ $0.37 Credit. 

XLU Bullish Opening Trade Signal

Strategy Details

Strategy: Call Debit Spread

Strategy Direction: Bullish

Details: Buy May 20, 2022 $73/$78 Call Vertical @ $1.43 Debit

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

1M/6M Trends: Bullish/Bullish

Technical Score: 10/10

OptionsPlay Score: 118

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View XLU Trade

View PEP Trade

Strategy Details

Strategy: Call Credit Spread

Strategy Direction: Bearish

Details: Sell to open May 6, 2022 $165/$170 Call Vertical @ $2.30 Credit

Counter Trend Signal: This is a bearish vertical spread trade on the a ETF that has a bullish 1M trend.

1M/6M Trends: Bullish/Neutral

Technical Score: 9/10

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

Our bearish DailyPlay today is Pepsico Inc (PEP). PEP is part of the Staples sector that has shown long-term underperformance relative to the S&P 500 and losing relative strength in recent sessions. PEP has recently rallied after declining to the $153 support level. Price is losing momentum near the $165 resistance area which provides an excellent risk/reward bearish entry.  

View ALL Trade

Strategy Details

Strategy: Call Credit Spread

Strategy Direction: Bearish

Details: Sell to open May 20, 2022 $140/$145 Call Vertical @ $2.20 Credit. We recommend opening a half position in ALL. For example, if you usually open 10 contracts for a trade, we recommend only opening 5 contracts for this one. 

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

1M/6M Trends: Bullish/Bullish

Technical Score: 9/10

OptionsPlay Score: 112

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

Like most other stocks, this has rallied sharply over the past two weeks. Now it finds itself against its all-time highs while marking a Setup +9 count. It wouldn’t surprise me if we see some consolidation starting shortly. With ALL’s next quarterly earnings report not due out until May 4, there’s no major bullish fundamental catalyst at play for almost six more weeks. As such, we will sell this call vertical here, looking for a price pullback/consolidation over the next few weeks. We’ll likely cover this short idea on a stock pullback to near $132.

Partial Closing Trades

• PYPL: 81.6% Gain: Sell to close Apr 29, 2022 $100/$120 Call Vertical @ $12.62 Credit. Close half of this position. For example, if 10 contracts were opened for this trade, we recommend closing 5 contracts.
• DHI: 55.5% Loss: Sell to close May 20, 2022 $85/$97.5 Call Vertical @ $4.43 Credit. Close half of this position.

Adjustment Trade

FB (Long Jul 15, 2022 $230 Call) – 47.7% Loss: Sell to open Jul 15, 2022 $260 Call @ $4.65 Credit. 

• This converts the current long call FB position to a Call vertical and in doing so, reduces the cost basis of the long call from $23.68 to $19.03. Please note that this signal should only be used if you are already in the FB trade that was opened on February 7th, 2022.

View GE Trade

Strategy Details

Strategy: Call Credit Spread

Strategy Direction: Bearish

Details: Sell to open April 29, 2022 $95/$97 Call Vertical @ $0.96 Credit

Trend Continuation Signal: This is a bearish strategy on a stock or ETF that is experiencing a bearish 6M trend. 

1M/6M Trends: Bullish/Bearish

Technical Score: 5/10

OptionsPlay Score: 110

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

GE bottomed before the SPX did, but has also already reached a daily Setup +9 count while also sits stopping against its Propulsion Exhaustion level at $96.09. Getting a few closes above $96.09 would up the odds for another leg higher to near $107, so we wouldn’t want to be short for that (i.e., we’d likely exit the trade if $97-ish is hurdled). On the downside, if we do see a pullback from here, we’d look to cover most if not all of this spread if price gets to near $88.50 (the newest bearish Propulsion Momentum level (highlighted in yellow).

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.

View DHI Trade

Strategy Details

Strategy: Call Debit Spread

Strategy Direction: Bullish

Details: Buy to open May 20, 2022 $85/$97.5 Call Vertical @ $4.43 Debit

Trend Continuation Signal: This is a bullish vertical spread trade on the a ETF that has a bullish 1M trend.

1M/6M Trends: Bullish/Bearish

Technical Score: 6/10

OptionsPlay Score: 101

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

Our bullish DailyPlay today is D.R. Horton (DHI). DHI is part of the Homebuilders sub-industry that has outperformed the overall market and the Industrial sector since pandemic lows. In recent months, homebuilders have been put under pressure and have declined rapidly which provides a good risk/reward bullish opportunity for a move higher in coming weeks. 

Taking Partial Profits

• PAAS: 57.3% Gain: Sell to close Apr 14, 2022 $26/$30 Call Vertical @ $1.73 Credit. Close half of this position. For example, if 10 contracts were opened for this trade, we recommend closing 5 contracts. We are closing half of this position as yesterday marked a daily +13 and we are at the top of the trading range. 

Closing Trades

• MRNA: 77.7% Gain: Sell to close Apr 22, 2022 $140/$170 Call Vertical @ $18.48 Credit. Please note, this was the initial MRNA position that was opened on Thursday, March 10th. The other half of the MRNA position (Mar 18 $150/$175 Call Vertical) that was opened yesterday should remain open. 
• XLI: 62.2% Loss: Sell to close Apr 14, 2022 $89/$97 Put Vertical @ $0.79 Credit. 

NYCB Bullish Opening Trade Signals

Strategy Details

Strategy: Call Debit Spread

Strategy Direction: Bullish

Details: Buy 1/2 Long position of NYCB April 14 $11/12 call vertical for $0.42 mid AND Buy 1/2 position Long position of July 15 $11/$13 call vertical for $0.72 mid

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

View NYCB Trade 1

View NYCB Trade 2

Entering the Trades

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

Community banks thrive on local customers businesses and making the spread on lending long-term to them while borrowing short-term to fund it. Given that Monday was the fourth time down to the $10.84 level since last summer, and the first Sequential -13 signal of the entire decline that we’ve seen, we’d look for NYCB to move up near-term to $12 (top of channel) and a multi-month move up to $13. Thus, we’ll buy a half-sized position in both the April and July expirations, looking for last week’s low to hold as support.