We used a Hidden Pivot price target on Friday to exit call options acquired three days earlier for nearly three times what we’d paid. Four April 7 16 call options remain in our position. Based on the option’s 1.10 closing price, the position is showing a theoretical gain of around $1082. Imputing gains realized so far will allow us to carry the calls with an effective cost of minus 0.47. The chart shows how we were able to close out the calls precisely as the underlying VXX was spiking to an intraday high of 17.50. It would have been extremely difficult to do this the ‘usual’ way, waiting to see what the bid/asked was on the calls when VXX was hitting its target. There would have been only seconds to determine this and place the order. Instead, we simply projected in advance that the high on the calls would be 1.69. This permitted us to place an order before the opening to sell them for a tad less — in this case 1.64 — to raise our odds of getting filled. The calls topped at 1.70, a penny above our target, making our profitable exit effortless and certain.
This is a relatively new approach for Rick’s Picks, and it is working well. A corresponding put trade in DIA delivered similar results. March 31 208 puts acquired earlier in the week for an average 0.92 could have fetched as much as 3.32 on Friday when stocks swooned on news that Trump’s healthcare bill had gone down in flames. Both of these trades were featured on The Scoreboard, a list of pending, explicitly detailed recommendations posted by Rick and some advanced Hidden Pivot students. _______ UPDATE (Mar 26, 8:45 p.m.): Before the opening, offer two calls (or half of your remaining position) at-the-market. _______ UPDATE (Mar 27, 12:31 p.m.): Subscribers reported selling calls on the opening for 1.59 or more when VXX spiked fleetingly above Friday’s high in the first minutes of the session. The implied $412 gain brings the total, realized theoretical profit on the position to $1494. Plan on holding the remaining two calls (or whatever is left in your position) until just before they expire. If you don’t subscribe but would like to join great traders from around the world in the chat room, click here for a free two-week trial subscription. You’ll also receive actionable trading ‘touts’ and invitations to frequent ‘impromptu’ sessions where Rick ‘takes requests.’