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  • Swing Trade Idea (NET) – July 11, 2024

    Jul 11, 2024 Swing Options Tips Comments Off on Swing Trade Idea (NET) – July 11, 2024

    Our bearish trade for Thursday, July 11th is Cloudflare Inc (NET). NET is part of the Technology Sector, which traded into the top of an uptrend channel and performed at 10.24% over the last month. NET overperformed relative to its sector over the last month at 16.46% despite a pullback.

    NET traded into an area of resistance at $87 and has started to pull back from this level. With the Technology Sector being trading at the top of an uptrend channel and NET being overbought at this area of resistance, we expect to see a pullback to close the gap towards $77. This Credit Spread provides a Premium/Width of 43% which is an excellent risk/reward ratio.

    As a close, if NET were to trade above $84 for multiple days, this would invalidate our analysis and we will consider cutting losses on the trade. We will also consider cutting losses on this options trade if the value of the vertical spread moves above $2.40.

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