Bearish – XLP $56.98 – Consumer Staples
The idea presented is the opinion of the Options Action staff and not a recommendation by OptionsPlay.
On Friday’s Options Action, the crew analyzed the performance of the consumer staples sector. Staples is currently trading near its 52week high and forming a double top. Coupled with lofty valuations and negative earnings reactions, there is a high risk of a pullback. Expecting XLP to trade lower, Michael Khouw suggests buying a June 56 Put a $0.75 Debit. As of Friday’s close, these puts were trading at a $0.62 Debit.
We’ve structured this trade in OptionsPlay so you can analyze and view this trade along with the supporting technical chart at your convenience. You can also view the Options Action’s video by clicking on the following link: XLP Options Action Video
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