We entered a JWN (Nordstrom) bear call spread today on a Chaikin analytics overbought sell and relative strength sell signals. JWN reported last week, so no need to worry about earnings. The XLY ( consumer discretionary ETF), to which JWN belongs , continues to underperform the S&P and is a great place to look for neutral-bearish trades in this overbought market. JWN has a very bearish Chaikin Power Gauge rating, the long term Chaikin Trend line is pointing down and price is below the trend. Additionally, the Chaikin Overbought / Oversold oscillator is currently in overbought territory and rolling over. Plus, there's bearish money flow and weak relative strength for better than the past 6 months. This trade met all of our rules. We received a decent credit at the open today, with a 40% reward v 33% risk. You can see all of our options trades here.
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