Playing for a rally in $GOOGL

This morning I bought calls in $GOOGL. I have the weekly $585 calls and the September $580 calls. I think GOOGL makes its way back up to $600 and then tests the post-earnings high of $615. We had a nice pullback and I think we are going to breakout above $580 in the coming days. There is a lot of paper in the September options, specifically the $575 calls. Today alone (at the time of this writing) there is over $1.5 million in calls bought.

There is a dragonfly doji forming on the weekly chart, a sign that we have put in a bottom. The reason I am buying the ATM September $580 calls is because the market is still in a dangerous spot and if the market were to pullback a few days, I still want these calls to have a good shot to make money. The relative strength in GOOGL today tells me that it will hold up well in any pullback. My target is $600 for the sell. I may sell sooner if first, the broader market looks very weak and shows signs of breaking down (but I am still up on the trade), or two, if GOOGL shows signs of underperforming the broader market (one sign would be a failure to break $580 the 50dma).

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Max Ganik (Maxzak) is a 19-year-old stock and option trader. As of June 2016, Max has been a member of Option Millionaires for over 3 years, and has been a contributor for over 2 years. Max regularly writes blogs for Option Millionaires and has also presented webinars.

Max is the founder of Ganik Market Strategies. He is a member of the Leaders Investment Club. Max has been interviewed by the New York Times, CNBC, and Bloomberg TV. He was also the first high school member of the New York Society of Security Analysts. Max is currently a member of the University of Michigan's premier investment club, Michigan Interactive Investments.

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