Chinese stocks took a beating yesterday, but this Chinese stock, NIO (Ticker: NIO), managed to maintain its uptrend line:
If NIO can continue to honor this trend line today, I will buy the July 16 50-strike calls with an implied volatility of 62.99 and sell the 55 calls with an IV of 71.36.
This 5-point spread has 11 days until expiration and NIO traded up to $55.13 just last Thursday.
I will pay around $1.45 for this spread as long as NIO trades above that trend line.
I will take my losses if the spread trades down to $1 and begin to take my profits above the $2.50 level.
- I am still in my SPY July 09 427.50/417.50 put spread. I was supposed to take my losses a while ago, but I am still hanging on. Definitely against the trading rules.
- I still have 40% of my Marathon Digital Holdings (Ticker: MARA) 29/36 call spread. MARA looked a bit weak yesterday. If it trades down today, I will definitely be out.
- Southwest Airlines (Ticker: LUV) traded lower yesterday, so no trade — not a valid doji.
Thanks for Reading … See You Next Tuesday!