Have you been to the mall lately?
WOW! Be careful because it is mobbed.
People are out and about — finally!!
I’ve scoured the retail stocks and the one I like is Target (Ticker: TGT).
Target had a huge move –almost 4.5% — on Friday, trading up $7.94, from $179.61 to closing near the high of the day at $188.30.
As you can see on the chart, it has broken out of a trading range it had been since March 9.
With this breakout, I think TGT is on its way back to trading $200.
Looking at the Apr16 call options, the strikes are in increments of five, instead of two and half, which limits my spread choices.
I could buy the five point call spread, 190/195, or the ten point spread, 190/200 for a dollar more.
I like buying the five point spread here because I’m spending less money for a likelier outcome — the stock will trade $195 before it trades $200.
The bid/ask spread is a bit wide, but they are trading, so the volume is there.
I would like to buy the 190/195 call spread and pay $1.40-$1.50.
I will sell this spread and take my loss once it trades below a dollar.
On the upside, I will begin to take profits when the spread is trading $2.50 and better.
As for going to the mall, at least I refrained from swimming in the fountain like my sister and I did when we were little.
Get out and shop!!
Thanks for Reading … See You Next Tuesday!