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FB DBL DIAG Sell135/buy145 Call, Buy130/sell125 Put 21 APR 17

Trade Overview :

  • Company: Facebook (FB)
  • Strategy: Double Diagonal to Short

Reason for entry

When the trade was placed, the price was around $133.50.

Weekly chart is showing up-trend but daily chart is showing weakness. Setting up a Double diagonal to catch a quick profit trade. Some cushion is incorporated so even if the stock goes up few dollars it will be fine. As long as it does not shoot up too much.

Entry setup

Date 2/15/2017
Symbol FB
Reason Long term chart is showing down turn. Expect it to keep going down a bit more.
Action FB DBL DIAG sell135/buy145 Call, buy130/sell125 Put 21 APR 17
IV 0.195
HV 0.157
Direction Sell
Short Squeeze Float % 1%
Exit point lose  $               350
Max win  $               910
Early exit point  $               550
Prob Touching 68%
Prob Win 32%
Return 260%
Good / Bad (exit point) Good Trade
Money held  $            2,573
Prob lose ITM 40%
Prob win ITM 60%
Rward ratio (based on money held) 35%
Good / Bad (money held) Good Trade
Win / Lose overtime (exit point) 53.2
Win / Lose ratio  $              0.15
Win / Lose overtime (max lose)              483.20
Win / Lose ratio  $         710.59

Charts

fb diag 21 apr 17



fb diag 21 apr 17 option setup

Trade Apgar Test

Any trade with Apgar test score below 6 should be avoided.

Expectation Short Score
Weekly Chart EXP MA 0
MACD 0
MFI 1
TTM 0
DMI 0
Daily Chart EXP MA 1
MACD 1
MFI 0
TTM 1
DMI 0
Total Score 4

Trading result and after thoughts

It reached to the early exit point and got stopped out. As of today (3/10/2017) the stock price is at $138.79, which is way beyond the stop loss point. I am glad I got out at the early stop point.

At the time of this trade, I did not have Trade Apgar Test in place and it clearly indicated this was not an ideal trade.

FB Feb 2017 trade follow up

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