To The Moon

This is a trade idea for today and not meant for investment.

After seeing a bullish engulfing candlestick pattern in the daily chart for $Bank of America(BAC)$, I'm looking at a possible short term trade using bullish option strategies such as

1) sell single put at 35 strike price on DTE 27 May to collect around 1-2% premium

2) bull call spread with long call 38 or 39 strike price with short call at 44 strike price on either DTE 27 May or 17 Jun 

3) broken wing butterfly or butterfly spread with middle strike at 44 strike price on DTE 27 May

Given option pricing during off market are usually inaccurate, I will re-access my trade plan later in the day when market open to decide further which option strategies is more viable.

For tiger friends who are not option trained and if you are bullish on BAC short term base on price action, it is also viable to buy at current price and take profit at a higher price at your own discretion.

My trade idea explained 

1) Why trade instead of invest? At a price to book of 1.2 together with other financial metrics, it was a decent but not a compelling buy from an investment point of view

2) Base on price action, it could possibly found a bottom near 36.5 last seen in July 2021 to form a possible double bottom formation. Again this is base on probability not certainty.

3) Since I'm not planning to own this stock and do not wish to commit sizable funds on this stock, the logical way is to trade it. With a margin account, you also do not need a large buying power and can free up your cash for alternate investment or other trade opportunities.

As always, my sharing is for educational purposes only. This is not a buy or sell recommendation. Please ensure you understand options and its risks involved before taking any trade.