A classic Chaikin Analytics set up for a bearish trade on Anadarko Petroleum ($APC). Earnings are behind it,. It's overbought, with persistent recent negative money flow (though it turned weakly positive during its recent up move), weak relative strength and a very bearish power gauge. Today, Chaikin Analytics flashed a relative strength sell signal, which is a longer term signal. These don't always work out, but they are among the most powerful signals on the platform. I used a high probability call credit spread to give me a win even if the stock goes sideways or even up a little from here.. Breakeven is the short strike plus the credit received. If $APC closes below $40.68, I'll profit by at least a penny at expiration. Max gain is below $40. I plan on taking profits if the spread decays to $.34. Based on my portfolio size of just above $100k, I position size so I don't lose more than 1% of my account value if my trade blows up.
SOLD -5 VERTICAL APC 100 MAR 16 40/42.5 CALL @.68.
SOLD -5 VERTICAL APC 100 MAR 16 40/42.5 CALL @.68.
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