July 18

ADSK Stock Option Trade Setup 7-18-12

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August 16 is the Earnings date for ADSK. Earnings will be announced before August expiration date. Therefore, we are going to look for an option trade if Technical shows a possible trade.

3 times now, we have bounced off the support of 30.13. The sentiment is still bearish but we can experience a long term pull back to the value of 35.61. If price can break 32.68 then there is high probability, we may undergo a pull back.

Here is the risk graph for the option trade we are looking at. This trade is for the aggressive option trader. The conservative trade is shown below this one.

Per contract, we will be risking $28 to make a possible $72. This is 250% return in 1 month. As long as the stock is above 35 by expiration, we can get the max profit of $72/contract.

It is a low risk trade with high reward.

If you want to go out further than August just in case they delay the earnings announcement or need more time, you can do the following option trade. It has a reward/risk of less than 200% but the expiration date is Oct. This is for the conservative trader.

If you would like to learn how to trade options the institutional way, visit www.ichimokutrade.com. You can learn technical analysis with Ichimoku, pairs trading with options, seasonal trading with options, etc. We offer University level education!

EDUCATIONAL USE. Commodity Futures Trading Comission, Forex, Futures, Equity and options trading has large potential rewards, but also large potential risk and may not be suitable for everyone. You must be aware of the risks and be willing to accept them in order to invest in these markets. Do not trade with money you can not afford to lose. This is neither a solicitation nor an offer to Buy/Sell. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this document. The past performance of any trading system or methodology is not necessarily indicative of future results. All information provided on the Blog is for educational purpose


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