Today we are applying a Bull Call Spread on Wesfarmers Ltd (WPL)
WES is currently trading at $36.42
WES has been trading in a strong uptrend since the start of the year and the market turn around. Recently though it had a knee jerk sell off to a report. Over the past two days buying has come back in following a bounce from both a key level of support and the uptrend line. This shows WES breaking a triangle pattern in the direction of the underlying trend. We could expect WES to continue higher from here with the next target back towards its recent peak.
Instead of simply buying the stock, we can instead leverage and use a Bull Call spread. If we set it up correctly, we can profit from not only bullish movement, but also sidewards movement as well. This is helpful in these situations as WES does seem to drift higher rather than have explosive bullish movements.
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.