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Justify initial order

welcome to straddle income we're here to help you make money today is january 25th it's monday it's the first day of the biggest earning week in this week there are going to be several big companies reporting earnings tesla microsoft facebook apple these are big names in the industry and it's going to be a very exciting week and it definitely has an exciting start so before i actually jump in and talk about the trade that i made today first let's look at a chart as you can see from the qqq chart and spy chart here the day really started very strong in the morning actually the market entire market has been quite crazy in the last couple days and when i first got up this morning i was shocked how the market is being so strong there's a lot of good anticipation of this week so many people are so positively thinking this weaker is going to be good you know this goes back to what i would have been thinking the stock market was pretty much dominated by institutional investors in the last decades couple decades but starting from last year it has shown that retail investor can dominate the evidence for the hypothesis was on friday you can see the game stop stock just being absolutely crazy nicola earlier last year so a lot of people is having a lot of money in the stock market the retail trader is showing their power here and because it's a strong earning week this week let's come back to this today has been a lot of anticipation of good earning reports major cap companies including tesla apple all those companies people are so hyped up last week netflix actually put oil on the fire you know people are seeing netflix can report such a good number with 10 15 increase so anyway coming back here a lot of good anticipation on monday and then all of a sudden starts to drop this is very sharp drop in three minutes this entire index dropped at 1.5 percent this is very interesting there wasn't any news there wasn't any significant events actually matter of fact you know several of the big state has taken back the you know the stay-at-home order so that should be good thing but really it dropped so what my hypothesis and this is totally my guess here is we somebody decided to calm the market the people are saying this market is getting out of the control so let's put a break on it and they did and because of that fact the market dumped it really quick in the last couple minutes and it killed a lot of the momentum for big major cap stocks this momentum killing actually hurts somebody if you look at the stock shares perspective it doesn't change that much because the market pretty much closed where it opened but if you're talking about options leverage a lot of momentums have been killed a bit with this big drop actually we can get into that later in the next couple videos i can make a tutorial about it but really what happens here is the market dropped and it dropped quite big and then kind of crawled back same goes for the s p 500 index actually for the s p 500 index the market closed higher than open and if i take a step back look at the daily chart again very powerful this is just every time i touch the moving average light it just rebound it rebound it rebound it i don't understand this at all but i guess i'll just listen to the market same goes for the qqq actually you know also rebounded back so net net very strong market very bullish market and they just keep kept going up and if you zoom out a little bit further look at where we came from in march 2020 it was 164 this is 330 the entire index doubled same goes for sp np well 218 384 less than you know double but just absolutely crazy here okay enough about the market let's talk about the trades that i made today the first trade that i did today is actually about gamestop so i didn't buy anything call you know bullish about game stuff i don't know how many people here are familiar with the background of the game stuff if we look at the chart and you can't even look at it you have to zoom in already here basically on friday the game stopped jumped from 42 to 75 highest point and then today kept going to 159 so what i did around gamestop on friday i bought a two of the puts so let me show you game stuff here gamestop i bought a two of the puts at 21 dollar i paid about 45 each i just don't think that this thing is going to be sustainable this is crazy this somebody will take money out and the market will you know it will all justify a little bit so enough of that what i did is basically basically pull it play the bullish you know inverse of that and play the bearish side of that trade so i did two of the puts for 21 dollar strike price and i paid 45 each total 990 and today i closed one of the put i got my initial investment back i still have one more put left i'm just going to write it out see how it goes it's going to be interesting to see how it looks this is very fascinating to see this is showing the power of retail investor you don't want to piss people off next i want to look at a little bit about the the next trade i want to talk about is for disney for the disney i want to take a step back you know i'm overall bullish about this need for the long term and here are my reasons we have to look at the both from fundamental technical side of the bills from the fundamental there are three reasons number one not the disney stock because the disney plus has really transformed the company from a media company to a technology company so investor really liked it i think the technology company is more scalable i think disney is gonna be the next netflix at least okay that's number one number two the disney stock is you know they just have not been able to open any parks or other major theme parks around the world you know the fact that the stock price kept going up it's right now 176 it's actually very high if you look at their history but the fact that this new world over its parks in the near future you know it gives me the bullish sentiment about the syntax stock actually california just announced that they will take down to stay at a home order so that's a positive sign i think you know it says that the government is seeing some kind of control on the coronal viruses cases so that's number two and the number three the reason i'm bullish about the disney is about because the disney plus as well disney plus this is the earning remember to report quarter four of last year so it covers the christmas and you know all the big holidays and when people you know they have some free time what they probably usually did is go travel but now they just probably just stay home and watch a lot of videos as you can see from the netflix earning pop so i think disney is going to report good earnings as well but the fact that netflix reported such a big earnings such a good numbers it sets up a very good anticipation for disney and because of that anything that's not as good is going to be bad so the anticipation is strong but anything less than strongly anticipated results will actually hurt disney so with that being said i don't want to play earnings for disney because i know i think anticipation has already been there i don't want to play that i just want to play long term so that's the fundamental side on the technical side you can see from this chart here disney stock has been pretty much just consolidating between 165 and 183 and today is actually 171. so the last couple days when netflix popped you know it helped the company by boosting us the stock price a little bit but now it just kind of came back down so i think right now disney is not something that a lot of people look at it because this week people are just so focused on tesla apple microsoft starbucks all those big tech companies but destiny is something that just out of their site out of their mind so i played the disney long leap call contract but let me tell you a little bit about this particular trade this is not technically a car contract as you can see what the call that i did is for january 21st 2022 i have been thinking about buying a 175 call for disney it expires one year out so the price of that is 2100 this is a lot of money for me i think because you can see i have several different positions for disney i don't want to over concentrate it so what i did is something called bold call spread basically the idea behind that is you're buying it cheaper and you're getting less profit so here's how to implement this you buy a 175 call which usually add the money or at least close to be in the money and then you sell a further out of the money call so in this case i sold a 210 call by buying a car i'm paying 2100 by selling the car i'm getting 10 uh one dollar back so the net net i'm paying about 1100 for the entire spread by doing that i lower my initial investment by sacrificing the maximum returns i can get because by buying a call you can potentially have unlimited returns but anyway let me show you how it looks like anyway let me show you how it looks like this is basically the setup the risk graph for this chart here what i'm showing you right here is if you look at the blue line here this is you know the profit and loss chart for this strategy i'm pretty much you know committed to sacrifice 1100 this is my max loss by my max profit would be around below 2500 so this is my max profit this is my max loss and i start making money around 186 dollars right here this is the typical risk graph profit loss graph for full cost spread and as you can see by buying a car and selling a car i limit my profit maximum profit here if you were just buying a car you would have this charge just come here and then just goes up without this big segment flat segment right here so this is my strategy for the long-term bullish sentiment for disney and i hope this information here is useful helpful thank you so much for your time if you like it please subscribe click the like button and share button and again thank you so much for your time i'll see you in the next video