Consider the following:
• Sell to close SLV November 18 calls at a loss.
• Sell to close half of DIA December 166 calls for a gain.
• Sell to close half of the BABA April 2015 105 calls for a gain.
• Hold the BABA January 90 calls that have now returned up to 146% gains in less than a month.
• Buy to open the BABA July 2015 135 calls up to $4. I believe BABA could trade well above $150 over the next year.
I’ve got good news and bad news.
The bad news is that we need to sell to close the SLV November 18 calls here. Despite silver being massively oversold, and in desperate need of reversal, time is running out fast on this one. Sell to close.
The good news…
Yesterday, I issued a trade on the DIA December 168 calls… and explained that we should hold the DIA December 166 calls, as well. Today, I’m recommending that you sell to close half of the DIA December 166 call to secure a gain ahead of tomorrow’s Fed meeting that may or may not cripple the market.
The better news…
On October 1, 2014, I issued a buy on a BABA put-call hedge.
Just recently, we closed the BABA put side of the hedge at a loss, allowing the BABA January 90 call to run free. Those January 90 calls now trade – as of 11:45 am EST – at $13.30. That’s a gain of 146% off $5.40 lows. Hold it.
Just recently, I also issued a buy on the BABA April 2015 105 calls. I was criticized for going so deep out of the money with options that traded at just $4.85. Today, those April 105 calls trade at $8.25. That’s good for a 70% gain. Sell to close half of this trade.
Even better…
We’re looking to get wealthy off even more BABA calls. This time, we’re going even further out of the money especially as BABA and Apple hint at possible partnership. Consider buying to open the BABA July 2015 135 calls up to $4.
This may seem extreme and wild. But we played Netflix the very same way, and walked with great gains. If this trade idea is “too far out there,” sit the round out. We’ll have more trades on the way.