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yahoo stock, trading strategy
[Weekend Summary]
Aloha!
I am back in one of my favorite places, the beautiful island of Kauai. This past week was one of adjusting and closing a couple of losers. I closed the Jun 12.50 calls on Nanometrics (NANO) that had initially been a calendar spread. I had brought in some income a couple of times selling other calls against the position, but overall it was a loss. Ditto with Nextel (NXTL) where I was stopped out of the Aug 30 calls that remained from an original straddle. I had made a profit earlier on the put leg. One of the nice things about a straddle is that the maximum risk is the initial investment and it would be quite rare to lose that all. In this case, my overall loss was quite reasonable in my estimation.
On the more positive side, AMD stumbled on Friday giving some encouagement that the 14 puts I own may have some value and add to an already profitable position. The same is true for MMM which went down to support. A break below support may also provide some value in my Jun 70 puts and that, again, would add to an already profitable play.
EBAY did a bit of retracing this past week and I wouldn't be at all surprised to see it drop to about 35 before heading back up. I am long the '07 40 calls on this stock and regularly sell calls against the position to reduce risk and bring in income. I am following a similar strategy with Yahoo (YHOO) where I own the '07 35 calls. I had sold the Jun 37.50 calls against that position, but bought them back as YHOO has been showing some strength recently.
I sold the Jun 121 calls against my Dec '07 115 and 120 calls earlier in the month. SPY has been staying below the 121 ma=2.09rk so it looks like I may be able to keep that income.
Briggs & Stratton (BGG) remains in a trading range and I am still short the Jul 40 puts. I am looking for an opportunity to roll them out and perhaps down with an eye to bringing in more income.
Siebel Systems (SEBL)continues in its' trading range occassionally providing the chance to sell some calls against my '07 LEAPS 12.50 calls. My initial investment was only 65 cents so repeatedly selling calls against the position may remove much of the risk over time.
Micron (MU) retraced and is now back near its resistance around 11. I would like to see it break up, but if not, there will be another opportunity to sell calls against my LEAPS.
The market is clearly in a ho-hum status. The Naz was down about 8, the Dow 30 up about 50 and the SP-500 essentially flat (+2.09) for the week.
Enjoy your weekend! I intend to enjoy mine.
Bill
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