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Wednesday, May 20, 2015

Exit of IWM June$114/109 bull put spread with a profit

In about 3 weeks after entry of Jun$114/109p, IWM pulled back to a high level to give the position a major profit. With 30 DTE, I decided to exit according to the trading plan and it would give me additional power for new opportunities. With IWM at $124.87, the cost to close the position was about $0.12. Since the entry credit was $0.52, the profit percentage was 76% of max potential profit. Now, I have opened more funds for two positions.

Among all of my 6 trading ETF’s, XLE had touched the lower Bollinger bands. A bull put spread seemed to align with XLE uptrend in the last few months. The trending conforming spread was what I needed for the portfolio for now. So I entered an order to sell July$74/69p vertical for $0.50 with 58 DTE. The next major support appeared to be around $74, the short strike with a Delta of 0.19 as well. However, the order was not filled today.

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