This GOOG trade keeps working for us
Andy Swan created and
co-founded DaytradeTeam.com five years ago on a principle of empowering
individual stock and options traders with the techniques and analysis methods
typically reserved for elite professionals. His expertise in technical analysis
and commitment to educating members earned DaytradeTeam a top-ranking among
advisory services for several years.
Day Trading Google for an Easy
$2.50/Share Profit
Friday was another very good day in the
DaytradeTeam Live Day Trading Room, but one day trade in particular on
(
GOOG |
Quote |
Chart |
News |
PowerRating)
stood out as one of those where you just think to yourself–“this stock trading
stuff is just too easy”. Here is how the trade played out over the course of the
day:
You will notice that we sold short GOOG at 403.20
fairly early in the day (red text), watched the stock trade basically flat for
several hours, and then cashed in by buying to cover the position at 400.70
(green text) after a high volume selloff took place at around 2:30 PM ET (blue
text).
So what was it that led us to make this trade and
to be so confident and comfortable of its profitability throughout the trading
day?
Well, Friday was options expiration day for the
November contracts and we knew that GOOG was very likely to close the day at or
near its max pain strike price. We knew this by looking at the recent past
history of GOOG’s day trading patterns on options expirations days:
Notice how in four of the last five months, GOOG
has closed within 30 cents of its nearest strike price (and don’t forget that 30
cents is peanuts on GOOG!)
Expiration Month Closing
Price:
JUN 280.30
JUL 301.20
AUG 280.00
SEP 300.20
OCT 339.90
As we expected, this month was no exception, and
GOOG closed within 20 cents of the 400 strike price—and made our members a
very nice $2.50/share profit in the process!
Andy Swan