UAL Bearish inclined naked calls 9 Sep expiryWhats The Plan/Trade/Thought
Similar hypothesis to July’s UAL trade
I do feel that Airline would be the next sector to move upwards as the airline start coping with the travel surge. I would probably have to be more cautious on this after Sep
Flight delays and cancellations have battered the US industry this year as consumers starved for travel during the pandemic have forked over higher fares and crammed onto aircraft. The disruptions, fueled in part by labor shortages and air traffic control issues, have boosted costs as carriers seek to recover from two years of losses. Now concerns are rising that inflation could quash demand.
www.bloomberg.com
Both DAL and UAL had lacking earnings which is expected
Risk Mitigation
There is an S&R point at 41.10 and 39.88 (9.51% from entry). These are my alert points where I need to get out because I would probably be wrong
Imagine Yourself Taking The Other Side
The flip side would be markets rising despite the interest rate increases. This is a possibility but I won’t take this stance as it is even more risky given the larger bearishness and uncertainty
Look For New Information
No new information
How Do I Feel Now
I feel confident about this trade, espeically since we have seen 3 days of pull back with solid red candles rejecting the 39.88 S&R line
Trade Specs
Sold 230 Call options @ 0.2
Strike 43
14.86% to Strike
BP Used: 86,284.50
Max Gain: 4,450
