NEW DIRECTIONAL PUT PLAYS
SPDR S&P 500 ETF - SPY - close 112.72 change +1.23 stop 116.25
SPDR S&P 500 ETF (the Trust) generally corresponds to the price and yield performance of the S&P 500 Index. The S&P 500 Index consists of 500 selected stocks, all of which are listed on the exchange, the NYSE or NASDAQ, and spans over 24 separate industry groups.
Target(s): 110.62, 109.60
Key Support/Resistance Areas: 115.00, 113.00, 110.60, 50-day, 20-day
Time Frame: 1 week
Why We Like It:
The market is overbought and needs a healthy pullback to regain its energy. SPY has rallied right into resistance from its June and August highs. I'm looking for the S&P 500 to turn lower here, fill a few open gaps, and test its rising 20-day and 50-day SMA's from above. I suggest readers open short positions at current levels and look for a $2 to $3 pullback in the coming days (equivalent to 20 to 30 S&P 500 points). Our profit targets should produce +40% and +60% gains.
Suggested Position: Buy October $109.00 PUT, current ask $1.56
Entry on September xx
Earnings: N/A (unconfirmed)
Average Daily Volume: 198 million
Listed on September 13, 2010