Price Break Provides Option Profits in $MDT

In our TNT Options Trading Service on March 25th, we talked about Medtronic (MDT).

We suggested simple targets for $MDT if it should break and make a run either above its 100-day SMA or below its 50-day SMA. After a rally off of the December lows, the stock appeared to have double topped at around $94. There was also some negative news on the stock regarding a potential hacking of its devices, as they’re linked to a central monitoring system. The potential was there for MDT to ignore the news and continue its run, or pull back below its 50-day SMA.

The shares of MDT opened March 26th  higher with a brief run, but closed just above their 100-day SMA with an indecisive candle on the day. A close just off of the 50-day SMA the next day offered a brief put entry where on Thursday, the shares sold off to form a double bottom, intraday, at around $89.50 where a quick roll or an exit at support provided a profitable trade. The moves were quick though, as the stock didn’t hang around in any trend for long. As it happens with the market, what we want to happen, doesn’t always happen when we want it to! The beauty of the individual investor, though, is that we have time to wait for the right opportunity.

With the 50-day SMA still in play the next week, April 2nd saw the shares of MDT close at $90.40, below the support level after a spat of selling into the close. The weakness, and the closing level with conviction, provided an entry into a put position. MDT the next day would open and sell off to our first flat-line at $89 offering a chance to roll the position, and would trade all the way down to the next target at an $88 flat-line.

Subscribers took advantage of these opportunities and were able to profit anywhere from 35% to 255% using discipline and a strategy involving their flat-lines.

Join Ryan Mastro next week to analyze the next opportunity!