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Today we are applying a Bull Call spread on Santos Ltd

Analysis:

STO is currently trading at $7.09.

STO has been trading in a strong uptrend since July last year, riding increasing oil prices. Recently it has pulled back along with the rest of the market, but found the uptrend line and bounced. There is a positive piece of news that was released to the market today for STO, which has helped it stall and rise in spite of broad market pull backs.

Oil is expected to continue higher which should remain positive for STO’s share price, but it’s hard to predict the very short term movements of Oil. Instead we could look at a Bull Call spread, where if set up properly, can help us with the timing of the rise. The Bull Call spread can profit from both side wards and bullish moment, so if STO drifts side wards to higher, which it is often prone to doing, then we are still in a position of power.

 

 

 

 

 

 

 

 

 

 

 

 

If you would like to learn how and when to use this strategy, and other strategies like it, then please contact us here at TradersCircle on 03 8080 5788. Alternately, you can download a free eBook off our website which runs through advanced strategies.