>>>Targeting our 25th straight win LIVE at 4 p.m. ET TODAY!<<<
MicroStrategy (MSTR) has been on an absolute tear lately, mirroring and even amplifying Bitcoin’s volatility.
The stock has breached all-time highs multiple times since October, seeing gains that have outpaced Bitcoin itself. If you thought Bitcoin’s swings were intense, MicroStrategy is offering an even wilder ride — trading like a leveraged Bitcoin proxy.
But as tempting as it may be to just throw a hefty chunk into this rocket and wait for liftoff, I’ve got a more measured approach in mind to keep the risks in check.
My current strategy focuses on trading options around MicroStrategy rather than piling into the stock itself. With Bitcoin nearly hitting $90K overnight into Tuesday — and some analysts eyeing that elusive $100,000 mark — it’s easy to get caught up in the hype.
But MicroStrategy’s wild swings come with just as much downside as upside.
When Bitcoin goes up, MicroStrategy tends to climb even faster. Yet when Bitcoin pulls back, MicroStrategy can take a harder hit — with potential to drop 20% or 30% on a 10% Bitcoin pullback.
I’d rather not be caught in that kind of tailspin — but that also doesn’t mean it’s time to go with outright puts.
For this trade, I’ve been using credit spreads, debit spreads, and ratio spreads to capture gains while limiting exposure. Credit spreads have been especially useful, allowing me to scoop up consistent income as MicroStrategy rallies.
And with credit spreads, I don’t have to tie up major capital in the stock — or take the same heavy losses if things go south. Every one of these trades has the potential to yield 0.5% to 1% per spread, a decent return without the huge commitment.
Another reason I’m sticking with this approach is that MicroStrategy’s premiums have been fat — more than enough for profitable options trades without owning a single share. Each time I close out a position, I can quickly open a new one, adjusting my spread levels to catch more of the upside without sitting on the actual shares.
This way, if we continue the melt up in Bitcoin, I’m positioned to profit. But if the market goes into one of its classic crypto free-falls, I can step back without too much collateral damage.
The temptation to dive in and hold MicroStrategy outright is strong — but the reality is that an options-based approach has worked well for capturing the upside without the massive volatility.
This method gives me a solid blend of profit potential and risk management, so I can ride this surge without burning my whole portfolio if MicroStrategy suddenly hits a brick wall.
Bitcoin and MicroStrategy have some real momentum behind them right now, but I’ll keep playing the options until I see a reason to do otherwise. For more on this, be sure to check out “Final Hour,” weekdays at 3 p.m. ET!
I’ll see you in the markets.
Chris Pulver
Chris Pulver Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. Targeting Our 25th Straight Win at 4 p.m. ET!
I’m LIVE on Zoom at 4 p.m. ET today, Nov. 12, revealing how we’ve hit 24 straight wins…
And you can join us for what could be win No. 25 in a row!
This perfect “Weekly Windfall” ticker hasn’t lost once.
- The exact ticker behind this unbeaten streak.
- The precise 11:59 a.m. ET Monday setup.
- How we’re targeting win No. 25.
- Why this trade keeps winning — in any market.
And while we cannot promise future returns or against losses….
The profits and performance shown are not typical, we make no future earnings claims and you may lose money. From 9/30/24 – 11/7/24 on live trades the win rate is 100%, 18% average return, with an average hold time of 11 days.
