"If you take a look at the chart here, it's a beauty. We have, obviously, a very clean, uptrending stock showing a ton of relative strength compared to the broader markets," Gordon said Tuesday on CNBC's"We've fallen into a little bit of consolidation here following a good earnings report, and provided that the broader market holds in, we should get a resolution higher, up and above the [$]100 mark, following this consolidation break," he said.
Although calls — which are typically used to make bullish bets on stocks — would likely be rewarded if the stock goes higher, Starbucks' implied volatility pattern could set traders up for an unwelcome curveball, Gordon said. A put credit spread is a trade that bets on a slight rise in the price of the underlying asset. It involves selling a higher put, buying a lower put, collecting the remaining credit and allowing it to appreciate.
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