$DAL Delta US Stock trade of the week Earnings

$DAL Delta US Stock trade of the week Earnings.   $DAL Delta Airlines had earnings this week on April 12.    On the charts, the higher time frame were in a state of confusion.    As a result, we waited for earnings to occur to look for a possible trade.     The major long term resistance at 47.13 and major support of 42.70.

Below is the monthly chart provided by TradingView.

2017-04-14_195629_dal

Our goal was to do the following after earnings:   If price reached 47.13 then we would purchase put options with a tight stop.   If price reached the support at 42.70 then we would purchase call options with a tight stop.    Outside of those levels, we were going to do nothing.

From the chart, price went to 47.13 and bounced off it.

Below is the option that was executed.

2017-04-14_195738aapl

 

The Jun 16, 2017 43 Put options were purchased for 1.00/contract.   The risk shown is for one contact.    When we purchased the option, price had already moved off the resistance so there was some “slippage”.     That was no problem since the IV was low.

Currently, we have a gain of around 60%.    The goal is to take profits at 42.70.    Another option we have once that price is reached is to take the single put and turn into a verticial spread, diagonal, or calendar depending on when the support is reached.

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About the Author Manesh Patel