How To Be Right — Even When You’re (Almost) Wrong

Jack Carter | May 5, 2025

Hey Traders,

A trade I did with my members last week was more than a win, it was a lesson.

Because even though the trade ended up paying out, it came within inches of going the other way.

Let me show you what happened — and why the strategy we used made all the difference.

The Setup

This was a classic bear call spread that we entered on Tuesday:

  • Sold the 205 call
  • Bought the 210 call

That gave us a net credit — which is how we make our money on this trade.

As long as the stock stays below 205, we keep that premium and the options expire worthless at the end of the week.

Simple enough, right?

Then It Got Close…

Here’s what the chart looked like by the end of the week:

The stock was trending higher all week.

By Friday afternoon, it was bumping right up against the 205 level, which was right at our short strike.

In these cases, you’ve got two choices:

  1. Unwind the trade early and lock in a small profit or a loss, depending on the cost
  2. Do nothing — but only if you believe the stock will move back below your short strike by market close

I chose to do nothing — and this week I was right.

The Power of Structure

Right at the end of the day, the stock pulled back — finishing below 205.

That meant both options expired worthless.

And I kept the full premium.

But here’s the point:

If you don’t have a repeatable plan — if you panic when trades get close — you won’t be able to stay calm and finish strong.

This wasn’t luck.

It was structure, process, and discipline.

Final Thoughts

In trading, sometimes you’ll be way right.

Sometimes you’ll be way wrong.

This week I was wrong on the way the stock was going to move. Clearly, it moved against us almost from the moment we placed the trade.

But that’s why we don’t just bet on the direction.

With strategies like this bear call spread, we don’t just have a theory about which way the stock is going to move over the next few days.

We select strike prices that give us a comfortable cushion.

Most weeks, that cushion doesn’t come anywhere close to being breached.

This past week, we saw the power of having that cushion when we need it.

As I’ve told you in the past, it’s not just about picking the right stock anymore. It’s about using the right strategy — one that stacks the odds in your favor — even when the trade runs a little hot.

That’s how you stay in the game.

And that’s how you win — even when it’s close.

Trade well,
Jack Carter

P.S. Nate Tucci just shared three stocks he says he’d “bet the house on”. Get them here.

Trending Stocks of the Week — May 5, 2025

Jack Carter | May 5, 2025

Nate Tucci went LIVE with Roger Scott to share the Three tickers he’d “bet the house” on!

To help you discover the power of trends, every week I share with you a handful of the top trending stocks.

These stocks are picked by my purpose-built, custom-made TrendPoint software to pick the strongest trending stocks in the market right now.

If you know anything about me, you know that every trade I get into starts with a trending stock.

Unless a stock is in a strong trend, I don’t want to hear about it. In my book, wishy washy stocks are the quickest way to losing money.

This Week’s Stocks

SPY closed above its 200 day moving average and seems to be above it today. But don’t get comfortable! lot can change this week.

For now, here’s 2 bullish stocks and 1 bearish stocks you can use to create income:

  • CNP (bullish) – was on last week’s list, too!
  • ATGE (bullish)
  • HOLX (bearish)

And don’t forget about last week’s list, which you can find here.

What can you do with these stocks?

Well, there are a couple of things you could consider — after doing your own research, of course:

  1. Buy or short — For bullish stocks, this is probably the simplest thing you could do. Then just wait for it to go up and sell when you hit a profit target you’re comfortable with. This is only for upward-trending stocks we’re long on.

    For downward-trending stocks (those that we’re bearish on), you can short them. This is a little more advanced, so if you’re just getting started, I wouldn’t recommend this play. Remember, just like buying a stock, shorting comes with unlimited risk if the stock moves against you, so always have a clear stop-loss in place.
  2. You could buy an option.

    For bullish stocks, this means buying a call option.
    For bearish stocks, this means buying a put option.

    You know I’m not a fan of speculative plays, but every once in a while it doesn’t hurt to throw a little cash at a speculative option. Just remember, while options can move bigtime if the stock goes up… the downside of options is that you have a time limit on how quickly you need the stock to make that move.

    So think about your risk tolerance when you consider buying calls on bullish stocks or buying puts on bearish stocks.
  3. You could collect instant income.

    If you’ve been following me for any length of time, you know that I’m a big fan of income plays, because they massively increase your odds of winning. We do this by SELLING options instead of buying them.

    Not only do income plays let you get paid instantly — as soon as you place the trade. You massively increase your odds of winning, because the way we trade them, you don’t have to be 100% right about the direction of the stock.

    If you haven’t tried your hand at income trading yet, I urge you to try this exercise for yourself. Without risking any money, it will really let you see the power of income trading and why it’s my favorite method.

    Income plays on bullish stocks can be naked puts, covered calls or a bull put spread.

    Income plays on bearish stocks will be a little more complicated. But if you’re a more advanced trader, you can look into doing a short term bear call spread, which involves selling an out-of-the-money call and buying a call one strike price higher.

That’s all for now.

Stay tuned, because I’ll be sending you a new list of TrendPoint Best Trending Stocks every week! (usually Mondays)

Trade well,

Jack Carter