Hello Investors,
Today we discussed the spike higher in precious metals (Gold and Silver). The “exhaustion” signals within the charts. And why in the near term they look exhausted. There is still a great chance that this is only a top and not THE top. In addition, we took profits on our Micron (MU) trade ahead of the potential “January Effect” where leaders lag and laggards lead. This was also discussed in some detail. The trades are as follows:
Entered into a Bear Call Credit Spread in GLD. Bad r/r but higher probability of success strategy.
Sell to open: GLD March 20th (monthly) 430.00 strike call
Buy to open: GLD March 20th (monthly) 435.00 strike call
Credit: 1.05
Max risk = 3.95 or $395.00 per spread
Max reward = 1.05 or $105.00 per spread
Took profits on our Micron (MU) Call Butterfly as follows:
Sell to close: MU March 20th (monthly) 270.00 strike call (ratio of 1)
Buy to close: MU March 20th (monthly) 300.00 strike call (ratio of 2)
Sell to close: MU March 20th (monthly) 330.00 strike call (ratio of 1)
Credit: 4.22
Entered at 3.30 debit, exit at 4.22 credit. Result is a profit of +0.92 or $92.00 per spread
Have a great new year!