Netflix has dropped below support levels and now we need to act. After adding the call spread and then rolling the call spread down into an iron fly, we have a total credit of around 3.58. To close this trade today, it would be 4.52, or a loss of around $1.00. Emotional wins don’t mean much to me, but the adjustments did cut the loss from over $300 down to $100 per contract.
You can close out of the trade and take a loss or roll this trade and see if we can work back from the loss. That’s what I’m going to do.
I’m going to take the existing iron fly and roll it out in time and down in strikes. We have a narrow profit window, but we can keep managing it from there.
TRADE ACTION: Roll the call spread out in time and down for a credit of around 1.75
STO 1 SEP 415 call
BTO 1 SEP 420 call
BTC 18 AUG 420 call
STC 18 AUG 425 call
TRADE ACTION 2: Roll the put spread out in time and down for a debit of around 1.65
STO 1 SEP 415 put
BTO 1 SEP 410 put
BTC 18 AUG 420 put
STC 18 AUG 415 put