Credit Spread on Crocs

Yes those weird yet very comfortable shoes that one of my friends just loves…He owns three pairs!…. Crocs (ticker symbol:CROX) is on Brent Archers credit spread list today.

It seems that the Europeans do not like them! More specifically the patent office decided that they are not unique enough to give a patent, so the share price is dropping dramatically.

Brent is suggesting - “For a bearish hedged play on this stock, I would consider a March bear-call credit spread above the $45 range…we will make a 7.5% return in 11 weeks as long as CROX is below $45 at March expiration. Crocs would have to rise by more than 56% before we would start to lose money.” For more of Brents explanation check out his post here —> Crocs (CROX) finds trouble with EU patent

bear call credit spread, credit spread, crocs, crox

Sister Site

Option Spreads will be providing specific examples of different types of spreads while our sister site will be providing information for the beginnning option trader and how to trade options, specifically ways to use option conservatively, meaning how to trade spreads.

Conservative Options - www.conservative-options.com

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Sell in May and I went away

Sorry for the lack of posting but I am in the process of revamping and remodeling the site. I plan on offering new services including the podcasting I have been promising for the past year. I would like a little more interaction as well so many of the posts will need your input. I am looking forward to these new changes so give me about a week to implement everything and then I will be back posting anew with the strategies on how to trade conservative options.

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Market Crash new support and resistance

Well with last weeks crash there is definitely a change in the support and resistance lines for the market. Lets take a look at where we are at now…

QQQQ - Support = 42 which is around the 200d ma / Resistance = 44 or the 50d ma
SPX - Support = 1380 (200d ma stronger at 1365)  /  Resistance = 1420
OEX - Support = 630 around the 200d ma /   Resistance = 650 weak (660 stronger)
DJ30 - Support = 12000 (200d ma around 11950) /  Resistance = 12500
RUT - Support = 770 (220d ma 760) / Resistance = 800 strong

So if you look at the charts the next solid line of support for all the indices is the 200d ma. If we break that on one of the big indices such as the DOW or the SPX, then a new bear trend will follow suit.

My opinion is that we will stay above the 200d ma and be neutral for awhile. With the increase in volatility new trades should be easier to find.

Next post I will continue the discussion on volatility.

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