DailyPlay – Opening Trade (ROKU) Closing Trade (MGM) – December 11, 2023

Closing Trade

• MGM – 43.40% Loss: Buy to Close 10 Contracts (or 100% of your Contracts) Dec 29th $40/$43 Call Vertical Spreads @ $1.52 Debit. DailyPlay Portfolio: By Closing all 10 Contracts, we will pay $1,520. We initially opened these 10 Contracts on Nov 21 @ $1.20 Credit. Our average loss, therefore, is $32 per contract. 

ROKU Bullish Opening Trade Signal

View ROKU Trade

Strategy Details

Strategy: Short Put Vertical Spread

Direction: Bullish

Details: Sell to Open 3 Contracts Jan 26th $106/$593 Put Vertical Spreads @ $5.53 Credit per contract.

Total Risk: This trade has a max risk of $2,241 (3 Contracts x $747) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $747 to select the # contracts for your portfolio.

Trend Continuation Signal: This is a bullish trade on a stock that is in a bullish trend.

1M/6M Trends: Bullish/Bullish

Relative Strength: 10/10

OptionsPlay Score: 92

Stop Loss: @ $11.06 Debit. (100% loss on premium paid)

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

Please note that these prices are based on Friday’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

Investment Rationale

As tech stocks continue to outperform as the relative momentum starts to return to the Technology Sector. As such, ROKU broke out above a key price of $100. This was followed by a bounce higher which now confirms $100 as support for further upside.

We will look to Sell the Jan 26th $106/93 Put Vertical @ $5.53 Credit. With a hypothetical portfolio of $100,000, we recommend risking 2% of the portfolio’s value to this trade, which is 3 Contracts for a risk of $2,241. We will set a stop loss on the put spread at around 100% of the premium paid @ $11.06 Debit.

ROKU – Daily