Chart courtesy of Stockcharts
Today we placed an order to purchase the September 2009 PUT Options with a strike price of $16.00 for $1.00 per contract on The Bank of America (BAC) the symbol is BYOUP. They are currently bid $1.09 and asking $1.12 so our bid is on the low side but we will leave it in place and see how the week unfolds.
As we can see from the chart BAC has been on a very good run indeed and now looks to have peaked as the divergence between the stock price and the 200dma appears to be closing but still has a way to go. The RSI has been above the '70' level and turned south over the last few days along with the STO.
Bank of America has a market capitalization of $137.82 billion with 8.65 billion shares outstanding, a P/E ratio of 35.99 and closed up $0.08 today at $15.93. Bank of America trades on the NYSE under the symbol of BAC.
This series of options expires on 19th September 2009 so we will need to remain on the ball and be prepared to move quickly. If and when our order is filled we will place a sell order at $2.00 in the hope of making a 100% profit on the trade and then sit back and relax, all right, sweat a bit!
Your thoughts are of course most welcome.
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