Bottom Fishing at Target

$TGT

TGT 0.00%↑ has been pummeled this year. I’ve read about theft, etc; my personal belief is that WMT 0.00%↑ is eating their lunch….but none of that matters

The stocks bounced a bit in the past few days, and will be trying to close above a 20 day EMA for the first time since July. The chart above zooms out to cover the COVID timeframe.

While I don’t have much conviction in the upside, I’m willing to place a bet on the limitations left to the downside. I’m selling 90 put spreads, which represent the covid low for $TGT. I’m going out till March and I’m betting the stock doesn’t break that level (at least before then).

I don’t expect I’ll be in this trade till then, unless the stock takes another nosedive after earnings on 11/15. Ideally, it begins to recover or at least trend sideways, and implied volatility presumably will come down post the earnings report. This is the type of trade I’m hoping to close out at a 50% gain as quickly as possible. No hanging around and no tail risk.