The Options Trader’s Guide to Technical Analysis
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#7 KFT June 29 Calls
By Valerie Maczak, OptionsZone Editor
I admit it. I constantly break the cardinal rule of trading and I let my emotions get involved. But I’m a sucker for companies that I know and like,
which is why I got excited when OptionsZone’s
Chief Technical Analyst Sam Collins wrote that his Collins-Bollinger Reversal (CBR) indicator flashed a buy signal for Kraft Foods (KFT).While the technical evidence makes a strong case for a move up, playing the right option is key to capturing profit from it. I like playing slightly
in-the-money options that are a few months out. Open interest is also key for me, as I need an option to be liquid enough to ensure good entry and
exit prices.With KFT currently trading around $29 and Sam’s target of $34, my pick is the KFT June 29 Calls (KFT 100619C00029000).
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