Shares of Home Depot (HD) took a beating over the last couple days, a long overdue one. Down another 80 cents on the day, the second half of the HD November 87.50 puts now trade around $2.15. From an entry price of $1.70 that’s not a bad gain.
Sell to close this November put ahead of its coming expiration in November 2014.
However, I still see further downside in this name. I believe that HD will refill that bullish gap around $82.50 before all is said and done. HD just broke its 50-day moving average and its technical reads are still a bit over-extended.
Once you close out the November HD put, consider buying to open the HD January 2015 87.50 put options up to $4.
Also, consider selling to close half of the Janus (JNS) December 15 put options. These last traded – according to Yahoo – at $2.
We’ll talk again shortly.