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Option Writer Portfolio - July

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Cisco Systems (CSCO) has been in a consolidation phase with a slight upward bias since the beginning of the year. Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol-based networking and other products relating to the communications and information technology industry worldwide.

Sector: Technology

Industry: Networking & Communications Devices

EPS Date: August 5th

Technically speaking, CSCO is in oversold territory right at the cusp of breaking down. The Slow Stochastics is below 20 but hasn't broken back up and out to confirm the buy. This is an early entry on anticipation that the stock will hold the 89 day SMA (grey line) and bounce to the 200 day exponential moving average.

Risk Management for CSCO
Strike Stop = $ 24.00
Cost Basis Stop = $ 23.60
Technical Stop = $ 24.00

There is also some support at 24 from the gap up in April. So the primary risk management level will be at $24. This position needs to be done at the target price or else it doesn't make sense or dollars to do the trade. Anything less and the initial return doesn't fit our parameters.

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