TRADE - swing puts - Major divergence between price and RSI

14 Şub 2020

Line charts help to clear the noise of candles, and here you can easily see higher highs on AAPL daily chart with downsloping RSI.
There may be selling into the close today (profits before 3-day weekend) if you want a day trade, or you can open 2/28 or 3/20 puts, strike between 320-310.

14 Şub 2020

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Wanted to add, when trading divergence, make sure you have stop losses set because divergence signals may not always be followed by much of a countertrend move. Also be ready to take profits; while divergence can lead to a great options trades when a stock pulls back, the countertrend move can quickly reverse if buyers/sellers are waiting to buy/sell stock.