|
|
trade stock, stock share
[Weekend Summary]
Dear Member,
The Jan 85 Puts I entered on Pulte Homes (PHM) are looking ok for now. The stock was down $1.45 for the week in spite of good news for the sector, PHM and the sector in general couldn't follow up so I'm thinking the sector is continuing to weaken.
I bought some Jan 40 Puts (FCXMH) on Freeport Mcmoran (FCX)when it broke down through the neckline of a head and shoulders formation. So far the move looks ok. My initial exit will be a close above the neckline, but I will follow the move down if it continues to go my way.
I took some action against one of my SPY positions today. I own both the Dec '07 115 and 120 calls. The SP-500 (essentially represented by SPY) was down through the 50 day moving average this week and that is pretty bearish. In order to bring in some income, I sold the Dec '06 125 calls (CYYLE) for $7.50 a share as a covered position against my 115 LEAPS calls. If I did nothing until expiration, this would assure a 2.9% return before commissions. At the moment, the position assures a positive return if held to expiration and called out at 125. Of course, I wouldn't expect that to happen, and intend to trade in and out of shorter term calls (like the Dec '06 125's)as the stock price moves up and down over time. The idea is to try to incorporate some safety or at least reduce risk in the initial position.
Knight Capital (NITE) is still in its' uptrend, but has been running sidewise along resistance for a little while. There is nothing unusual in that kind of consolidation. EBAY and Micron (MU) are doing the same sort of thing, but along a support level rather than a resistance. Siebel (SEBL)is also continuing to consolidate, but now a little above support.
The candlestick signal on YHOO seems to have been an accurate forecast of a return to an upward move and the stock is now back up to the uptrend line.
Overall, the markets have turned bearish, but so far without a lot of push from volume. Both the Nasdaq and the SP-500 have broken down through the 50 day moving average and the DOW 30 Industrials dropped almost 162 points for the week and is resting on the 50 day. A break below would certainly not surprise me.
DON'T FORGET, SEPTEMBER IS FREE. I'LL BE TRAVELLING FOR PART OF THE MONTH AND WON'T TRADE DURING MY TRIP, BUT I'LL LET YOU KNOW BEFORE I GO WHERE ALL MY STOPS ARE.
I'm teaching a stock trading seminar this weekend so I'll miss some of this great late summer weather. Hope you get a chance to enjoy it.
Sincerely,
Bill
|
Home |
Subscribe |
All Rights Reserved |
Privacy Policy |
Advertising |
Contact Us |
Terms of Use |
Disclaimer |
Links
|
trade stock
stock share
|
