Tackle Today: Long Call Profit Targets
March 9, 2022
«Take Aim.»
Traders,
Let’s continue the trade plan we began yesterday for long calls. Specifically, we assumed you purchased a 2+ month ITM call option for $3. Now, suppose you’re right. The stock rises, boosting the value of the call from $3 to $4.50, netting you a 50% gain. What now?
When it comes to setting profit targets, there are three common approaches.
① First, use technical analysis and focus on prior resistance zones or expected moves to forecast when to ring the register. For instance, if you bought a call at support based on a bull retracement pattern, your target might be the previous pivot high. Long calls are similar to long stock, so you can use similar rules for trade management.
② Second, if you’d rather focus on the amount of gain in the call option, then target a 50% to 100% profit.
③ Third, rather than exiting the entire trade at a target, you could make one of multiple adjustments to reduce risk while remaining open to further gains. You could roll up the call to a higher strike. Or morph to a bull call spread by selling a higher strike call against the one you own.
🛑 Upcoming Options 101 Webinar: How to Swing Trade Long Calls and Long Puts with Coach Tyler Craig | March 14th, 2022 at 8:30 PM EST on YouTube
This next YouTube training will be focused on swing trading calls and puts using the S.T.E.P Swing Trading System. In our last webinar, we introduced the topic from a high level. This time, we’re building trade examples and focusing on how to enter and manage long call and long put trades.
In this webinar you will learn:
✅ What is Swing Trading
✅ The Long Call Strategy
✅ The Long Put Strategy
✅ Reward to Risk Expectations
✅ The Best Chart Patterns for Long Calls & Long Puts
✅ Case Studies
Video of the Day: Queen’s Court – Portfolio Protection
On today’s Queen’s Court, coaches Emily, Matt and Mark analyze how to protect your portfolio.
Chart of the Day: Biggest spike in a generation
How rare is this year’s surge in commodity prices? How about the strongest start to a year since 1915!
Today’s line up
Traders Lounge 11 AM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show Replay
If you missed last night’s episode where Coaches Mark Justice and Frank Martin talked about 10 Mistakes Traders Make in Volatile Markets or would like to watch it again, check it out here.
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.
Trade Masters 7:00 PM EST
Every Wednesday at 7 PM EST join us on the Trade Masters where two Coaches go head-to-head to see who can find the best trading setup.
Trading Justice 466: Wall of Worry
In this episode, Coaches Mark and Matt Justice discuss the current market conditions and the Wall of Worry:
- Military Conflict in Ukraine
- FOMC normalizing rates
- Inflation
- Stagflation
- Supply chain disruptions
Financial freedom is a journey
Sign up now and gain unfettered access to all of the quality content and powerful Scouting Reports that our Pro Members enjoy for 15-days absolutely free with no strings attached and let us show you what your trading has been missing.
Legal Disclaimer
Tackle Trading LLC (“Tackle Trading”) is providing this website and any related materials, including newsletters, blog posts, videos, social media postings and any other communications (collectively, the “Materials”) on an “as-is” basis. This means that although Tackle Trading strives to make the information accurate, thorough and current, neither Tackle Trading nor the author(s) of the Materials or the moderators guarantee or warrant the Materials or accept liability for any damage, loss or expense arising from the use of the Materials, whether based in tort, contract, or otherwise. Tackle Trading is providing the Materials for educational purposes only. We are not providing legal, accounting, or financial advisory services, and this is not a solicitation or recommendation to buy or sell any stocks, options, or other financial instruments or investments. Examples that address specific assets, stocks, options or other financial instrument transactions are for illustrative purposes only and are not intended to represent specific trades or transactions that we have conducted. In fact, for the purpose of illustration, we may use examples that are different from or contrary to transactions we have conducted or positions we hold. Furthermore, this website and any information or training herein are not intended as a solicitation for any future relationship, business or otherwise, between the users and the moderators. No express or implied warranties are being made with respect to these services and products. By using the Materials, each user agrees to indemnify and hold Tackle Trading harmless from all losses, expenses and costs, including reasonable attorneys’ fees, arising out of or resulting from user’s use of the Materials. In no event shall Tackle Trading or the author(s) or moderators be liable for any direct, special, consequential or incidental damages arising out of or related to the Materials. If this limitation on damages is not enforceable in some states, the total amount of Tackle Trading’s liability to the user or others shall not exceed the amount paid by the user for such Materials.
All investing and trading in the securities market involves a high degree of risk. Any decisions to place trades in the financial markets, including trading in stocks, options or other financial instruments, is a personal decision that should only be made after conducting thorough independent research, including a personal risk and financial assessment, and prior consultation with the user’s investment, legal, tax and accounting advisers, to determine whether such trading or investment is appropriate for that user.
