UPS Put Option Trade

Click Chart to Enlarge

Today I bought an Oct. 65 put option on UPS. Looking at the chart you can see a couple sizeable gap downs in June around 67.00 and 66.00. Price has now come back to fill those gaps. In doing so, it made a classic shooting star/doji with a long upper shadow. At that same day, the high price touched against the 3 standard deviation upper bollinger band. Then with the market showing weakness, I feel that today was a good entry.

If selling short, I would exit on any close above 67.00. For the option trade, you could exit there as well, or if you only risk a small part of your trading capital, you could not set a stop loss, and just plan to hold it till either 100% gain or till expiration.

I may make a post soon showing a unique way to look at some put/call data that I have never seen in print anywhere else. It is not rocket science, but can be very helpful.

Pete