Options up over 157% in just 5 days

My Trade Plan Details:

• IWM Aug 2 $220 calls near $2.80
  
• Stop: Close IWM below $215
• Target 1: $224
• Target 2: $228

My Reasoning:

I typically don’t go after ETFs (which is a single trade that owns a basket of stocks in an index), but in times of uncertainty, I find this helps lower my risk.

Today, I am eyeing what is probably the strongest index in the market over the last couple of weeks.  The recent pullback has my attention, and I think we will see it resume the uptrend soon.

My Bullseye pick that I want to buy this week is (IWM) calls.

My plan is to get started near the open today and buy both stock and options, hopefully near my target entry price, which I list below.

If this trade doesn’t work out for me, I will look at a closing price under $215 as my stop loss, which has been a key resistance/support level from last week’s pullback.

If things work out as I hope, I would like to scale out of most of my position for a 30-50% gain.  

I know the IWM has already made a 10% move higher from the $200 level a couple of weeks ago, and this is late in the game on this epic rally.  I like it right now because it is starting to reverse off of the first meaningful pullback, which usually leads to another move higher.

I think the next move could retest the 52-week high of around $225, which printed last week.  

If that happens, there is a good chance we will see the high taken out and then a spike a few dollars higher, maybe to $228 after that.