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Carter Worth And Mike Khouw's Intel Trade

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On CNBC's Options Action, Carter Worth spoke about the semiconductor space. He thinks that it's the leading indicator for the market and he noticed some signs that it's close to a reversal point.

Worth explained that PHLX Semiconductor index topped or bottomed before the S&P 500 INDEX in five from the last six turning points in the last 16 years and he wants to place a bearish trade in Intel Corporation (NASDAQ: INTC) as a way to exploit a potential pull back in the semiconductor space. Worth thinks that Intel is going to pull back to its trend line and he sees it at $27 or 10.45 percent lower.

Mike Khouw suggested an options strategy that is going to make money if Worth's analysis is correct. He wants to sell the July 30/31 call spread for $0.50. If Intel trades above $30.50, the trade is going to loose money and its maximal loss is $0.50. If the stock trades at or below $30, the trade can maximally make a profit of $0.50.

Posted-In: Carter Worth CNBC Mike Khouw Options ActionOptions Markets Media

 

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