Optioneering Newsletter

April 22, 2018

Mini Dow Futures Monthly

We trade with the trend and the long-term trend is up. The bears have had

the momentum recently. The pullback is expected to be followed by a

continued bull trend.

The first profit opportunity we will consider this week is in ANET, or Arista Networks, Inc. Arista Networks was founded to pioneer and deliver software-driven cloud networking solutions for large data center storage and computing

environments.

ANET Monthly

The monthly chart shows that ANET has been going almost straight up since the 2016 low. The current pullback is expected to yield to a further advance.

ANET Daily

ANET hit a new record high in February. New record highs are bullish. The

current pullback gives us a buying opportunity.

We are going to review a Call Debit Spread for ANET.

Traders who want a more leveraged approach could consider buying ANET calls. ANET has options expiring every week until June 1

st. After that, ANET

has options expiring in mid-June, September, December, January 2019, and January 2020.

Buy to Open ANET May 18th

220-strike Call Sell to Open ANET May 18

th 250-strike Call

We can see from the Call Option Spread Analysis Calculator that if the ANET

stock price declines by -2.5%, stays the same as it is now, or increases in price when the options expire, the spread will show a profit of 38.6% or $835. IF ANET is down 5% when the options expire, the profit will be 27.6% or $597. If ANET is down -7.5% when the options expire, the spread will lose -2.5% or

-$55.

The next profit opportunity we will review this week is in CRSP, or CRSPR Therapeutics AG. CRISPR Therapeutics is a gene-editing company. CRSPR is

focused on the development of transformative gene-based medicines for serious diseases using its proprietary CRISPR/Cas9 gene-editing platform.

CRSP Weekly

The weekly chart shows that CRSP hit a new record high last month. New record highs are bullish. This month’s higher low bottom setup points to a

further advance.

CRSP Daily

The daily chart also shows that CSP hit a new record high last month. The pullback from this month’s high gives us a new buying opportunity.

We are going to review a Call Debit Spread for CRSP.

Traders who want a more leveraged approach could consider buying CRSP calls. CRSP has options expiring in May, June, July, and October.

Buy to Open CRSP May 18th

expiration 40-strike Call Sell to Open CRSP May 18

th expiration 50-strike Call

We can see from the Call Option Spread Analysis Calculator that if the CRSP stock price declines by -7.5%, stays the same as it is now, or

increases in price at option expiration, the spread will show a profit of 31.6% or $240.

The next profit opportunity we will consider this week is in RH, or Restoration Hardware. RH is an American home-furnishings company headquartered in

Corte Madera, California. RH sells its merchandise through its retail stores and catalogs and online.

RH Monthly

The monthly chart shows that RH has been very bullish since last year’s low. Last month’s bullish trading suggests that the pullback from the December

record high is over and the uptrend is resuming.

RH Daily

As we said above, RH hit a new record high in December. New record highs are bullish. The pullback to the Mid-Line of the Keltner Channel gives us a

buying opportunity.

We are going to review a Call Debit Spread for RH.

Traders who want more leverage can buy RH calls. RH has options expiring every week until June 1

st. After that, RH has options expiring in mid-June,

August, November, January 2019, and January 2020.

Buy to Open RH June 1st

expiration 75-strike Call Sell to Open RH June 1

st expiration 85-strike Call

We can see from the Call Option Spread Analysis Calculator that if the RH

stock price declines by -2.5%, stays where it is, or increases in price when the options expire, the spread will make a 42.9%, or $300 profit. If RH is down -5%

when the options expire, there will be a 28.3% or $198 profit. If RH is down -7.5% when the options expire, the spread will lose -3.3% or -$23.

The last profit opportunity we will review this week is in URTY. URTY is the ProShares UltraPro Russell 2000 ETF. URTY seeks to achieve daily results

that are 300% of the performance of the Russell 2000 Small Cap Index.

URTY Monthly

The monthly chart shows that URTY has been in a strong bull trend since the 2016 low. This month’s trading suggests that a run to new highs could

be imminent.

URTY Daily

The daily chart clearly shows that the trend is up. The pullback toward the Mid-Line of the Keltner Channel gives us a buying opportunity.

URTY is a leveraged ETF. While leveraged ETFs contain more risk, they usually possess higher premiums as a result. We suggest taking advantage

of the high premiums offered by initiating call debit spreads.

Traders who want a more leveraged approach could consider buying URTY calls. URTY has options expiring in May, June, July, August, and November.

Buy to Open URTY June 15th

expiration 70-strike Call Sell to Open URTY June 15

th expiration 80-strike Call

We can see from the Call Option Spread Analysis Calculator that if the URTY ETF price declines by -5%, stays the same as it is now, or increases at all when the options expire, the spread will make a 29% or $225 profit. If

URTY is down -7.5% at expiration, the spread will make 3.8% or $29.

EARNINGS SEASON: There are four “Earnings Seasons” a year. The

seasons begin in January, April, July, and October and they each last

about two months. The earnings reports can have an impact on the stock

price. We don’t know if the impact is going to be positive or negative (or

nothing at all). It’s up to you to decide if you want to be in a trade when the

earnings report is announced. Here’s a link for a page that can help you

keep track of the report dates:

https://www.earningswhispers.com/calendar

Note: Profit performance displayed in this newsletter does not include transaction costs.

This newsletter includes some trading ideas following Chuck Hughes’ trading strategies along with educational information. For a complete listing of Chuck’s exact trades, including specific entries and exits and real time Portfolio tracking,

please call Brad at 1- 866-661-5664 or 310-647-5664