Sally Beauty Holdings, Inc. (SBH) has an ugly rally formation here. After a long rally from around $22, it has pushed up in a large 3 wave move that is finishing off with ending diagonal. This stock is ready to fall off a cliff. Although I expect a sharp move, the most viable option strategy on this stock is a long put diagonal. This is fine with me anyway because this stock can float and chop higher for a few more days or even a week or two before it declines. Here is my trade:
Buy to Open SBH May 20/Jun 17 30/35 Put Diagonal @ $258
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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.