I've closed my March bull put spread on T with the stock at $25.57, or 1.1% above the entry point.
It cost me a 51-cent debit to buy back the options, so my profit on the trade was 9 cents, or 17.6%.
I had opened the position on Monday, so not bad for four days work.
I had entered T based on a psar signal, buttressed the pps and macd. The price today turned down a bit, and with the options expiring after trading on Friday of next week, I figured it was time for me to go.
The sto had recrossed the overbought line back into the neutral zone, often a bearish indicator. Also, the adx is only 22, which is a level somewhat prone to whipsaws. I lacked confidence that the psar would indicate a significant rise.
Having said all of that, I was still 11 cents before the next resistance level. So there's always a chance that I jumped too early and missed out on profit.
The position was structured as short the $26 strike put, long the $25.
Abbreviations:
psar - Parabolic Stop and Reverse
adx - Average Directional Index
pps - Person's Proprietary Signal
ma20 - 20-day moving average
macd - Moving Average Convergence-Divergence
mfi - Money Flow Index
sto - Fast Stochastic
Topic: AT&T telecommunications
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