Last week we sold a credit call spread in Google, which expires next Friday. The stock has since moved higher and the spread has gone against us. This week we are initiating a repair strategy that will help us out and put us back on track for a profitable position. The divergence between the stock and the moving average has widened and a spinning top has shown up. This is a sign of indecision and the lower volume confirms a drop in buying activity for the stock. Our plan is to sell another credit calls spread to collect cash to our account. We can then use this cash to buy back the May spread leaving us in June position that is more out of the money.
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