Two New Asymmetrical Trade Recs: UVXY & AAL

Your UVXY Option Trade Recommendation

Last week, the ProShares Ultra VIX Short-Term Futures ETF (BATS:UVXY) underwent a 10:1 reverse split that took the ETF from $4 per share to $40 per share – in one night.

Almost one week later, the UVXY has already shed more than 11%. It kicked off the week at $34.75 as of this morning’s opening bell.

This bearish slide is exactly what I predicted during Thursday’s live webinar – if you missed it, you can find the replayright here.

And today, we’re jumping on this ETF’s downward spiral.

I’m bringing you a free trade pick on the UVXY with the potential to double this month.

The UVXY is decaying $0.35 a day right now.

Remember, the UVXY tracks the VIX futures with 1.5X leverage.

Essentially, that means that as volatility rises, so does the UVXY. And when volatility falls, it takes the UVXY down with it.

Now, in the coming days, I see the VIX falling. In the coming weeks, it could drop all the way below $15. If that happens, the UVXY will drop down to $30.

How do we play the downward move?

With a put trade. More specifically, with this put trade:

Buy to open the UVXY June 18, 2021 $35 put for $3.20.
We’re targeting a 100% move – or more – on this put trade. That means you’ll have an asymmetrical profit in your pocket in just a little over two weeks.

You can track this trade starting tomorrow on the Profit Takeover portfolio ,right here.

Speaking of the portfolio – we have an update below…

Take an Asymmetrical Profit on American Airlines Now

Our American Airlines Group Inc. (Nasdaq:AAL) July 16, 2021 $20 call hit a profit over 100% today. That means we’re officially looking at an asymmetrical gain on this airline stock after less than one month. It’s time to pocket this profit now…

Sell to close the AAL July 16, 2021 $20 call for $5.15.
Want to see where the rest of our Profit Takeover trades stand on their way to an asymmetrical gain? Click here to check out our portfolio.

VIX Traffic Light

Last week, my VIX traffic light went from yellow to red – which means volatility is going to drop, and the market is going to go up.

I expect to see a strong post-holiday week these next four trading days as volatility continues heading lower, bringing the S&P to new highs soon.

The long-term trend for the VIX, in fact, is down. By the Fourth of July, I expect to see the VIX drop below 15 – which will hammer names like UVXY, increasing the value of our new put position .

Mark’s Watchlist

1. ProShares Ultra VIX Short-Term Futures ETF (BATS:UVXY) $35.85 (-0.86%)

This one’s obvious – with the VIX dropping, the UVXY is getting hammered. And we’re going to leverage that downward move into a fast asymmetrical gain with the newest addition to the Profit Takeover portfolio.

2. BlackBerry Ltd. (NYSE:BB) $10.87 (+7.94%)

Meme stocks are back. Folks across social media are pulling once-obsolete names back from the ashes – and today, they’re coming for the Blackberry brand. Over the past five trading days, BB has moved over 23% higher.

3. AMC Entertainment Holdings Inc. (NYSE:AMC) $30.90 (+18.39%)

AMC was second only to GameStop Corp. (NYSE:GME) in the “Reddit Revolution” that rocked the markets earlier this year. And the movie theater name isn’t going anywhere – not this week, at least, seeing as shares are up over 30% over the past five trading days.

4. Nokia Oyj (NYSE:NOK) $5.17 (+0.19%)

Another name that brings back memories of the early 2000s – NOK. The meme crowd hasn’t started bringing this clunky-electronics company up quite yet, but I’m keeping a close eye on this name. Why? Well, there’s one thing in particular that makes this stock stand out from the rest – its earnings, which means the company could be fundamentally strong as well.

5. Apple Inc. (Nasdaq:AAPL) $124.68 (+0.06%)

I’ve been talking about the fall of FAANG for a while now. But AAPL fell below $125 on Friday, catching my eye as a potential buy. In fact, I’m looking at the June $125 calls. These options have 18 days until expiration – and AAPL can make a noteworthy move in one day, making these options a good candidate for a short-term pop.

We’re kicking off this shortened trading week in true Profit Takeover fashion – with two portfolio updates, a lowered volatility forecast, and five additions to my Watchlist.

There’s tons of money on the table this week… and together, I can show you how to take it.

Until tomorrow,

Mark Sebastian

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