Today I stepped into an uncharacteristic setup for this portfolio. While most of my trades follow reversal patterns and are expressed through Bear Call Credit Spreads, Johnson & Johnson (JNJ) offered a different kind of opportunity — one that aligned better with a directional bearish move.
After an extended push into local highs, JNJ printed signs of momentum exhaustion on the daily chart. Price is pressing against the upper Donchian levels, RSI is hovering above 81, and the MACD histogram is showing early signs of slowing. The combination suggests a potential short-term pullback rather than further acceleration.
To express this view with defined risk, I entered a Bear Put Debit Spread, December 19 expiration, sized at 2 contracts:
Buy PUT 210
Sell PUT 200
Entry date: November 24
Net debit: corresponds to the trade log below
This structure allows me to position for a controlled downside move with a limited upfront cost.
👉 View on OptionStrat
👉 View in Trade Log
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Disclaimer
All content is for informational purposes only and does not constitute financial advice.Any trades or strategies should be tested in a simulated environment before use.Trading involves risk, and all decisions are the sole responsibility of the reader.