Broadcom Corp. gapped down three times in the month of July with the most recent gap identified as the exhaustion gap. An exhaustion gap signals the end of a move. These types of gaps are associated with a straight-line advance or decline. In this case it shows up at the end of a straight-line sell off in the price of the stock. Our goal is to buy the January 2015 20 Calls for 7.75 and hold this position until the stock makes a move to recover some of the gap.
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