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Carter Worth And Mike Khouw's Energy ETF Trade

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Carter Worth shared with the viewers of CNBC's "Options Action" his technical analysis of Energy Select Sector SPDR (ETF) (NYSE: XLE).

He believes the stock is ready to bounce after a long period of downtrend. Worth showed that although the stock reached its new lows recently, it outperformed the market, because it didn't reach a new low relative to the S&P 500. He interprets this as a positive sign that could lift the stock even further. He expects to see a 10 percent move higher.

Mike Khouw suggested that the best way to make a bullish bet is by purchasing the September 66/70 call spread for $1.20. The trade breaks even at $67.20 or 2.75 percent above the current closing price. It can maximally make a profit of $2.80.

Posted-In: Carter Worth Mike Khouw Options ActionCNBC Technicals Media Trading Ideas ETFs

 

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