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New Trade Idea: MS Bear Call Spread

This one comes courtesy of the Trading Digest:

Morgan Stanley looks to be near resistance at 20 and since the entire financial sector remains in doubt and will take some time to improve we think this may be an opportunity to for a call credit spread.

Buy MS Feb 22 call MSBV .95 IV 78.55 Delta .3292

Sell MS Feb 20 call MSBD 1.725 IV 85.53 Delta -.4807

Credit .775 Position net delta -.1505

I think this is a great play. Your area of profitability is anything below 21.40, and there's a good chance resistance will hold as we could see further deterioration of market conditions. I'm going to be picking some of these up at the open, probably at a better price since MS is up premarket. If the trade works, I'll move into a condor.

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by Steven Place

Steven Place is the founder and head trader at