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stock share, stock market result
[Weekend Summary]
Dear Member:
It was a down in week in a generally uptrending market for the Nasdaq and the SP-500. I chose not to open any new positions until the market gave a clearer indication of direction. As the Biotech Hldrs (BBH) dropped, I did find an opportunity to close the short leg (Mar 200 calls) by buying to close that leg. I place my order at $0.65, but was fortunate enough to get a fill at 55 cents. I had sold those calls on February 21st for $1.80 and bought them back on March 9th for 55 cents, thereby enjoying a profit of $1.25 a share (69% return) before commissions in only 16 days.
I still own the BBH Jan '07 200 calls. BBH has retreated to the 200 day moving average. If it bounces, I will roll the '07's out to Jan '08, though I am not yet certain to what strike price. A break below the 200 day will result in employing a different strategy. In that event, I'll look at creating additional diagonalized calendar spreads to make some money during the continuation down and further reduce risk in the long position I currently own.
The play I entered last week, buying the Jan '08 15 LEAPS calls on XLK, the tech sector ETF (Exchange Traded Fund) looks good to me. The ETF has continued in its' uptrend and is in an ascending triangle which is often bullish. A close above 22.26 on some volume could be quite significant. XLK closed Friday at $21.72.
The bullish call spread (120/140) on SPY is doing fine.
As for my straddles, Cardinal Health (CAH) is continuing its advance and increasing the value of the Jun 70 calls. Morgan Stanley (MS) has broken down through the 50 day moving average and that may well be quite significant. Value is now being added to the put side of the straddle and a continuation of the downward move could make the play profitable. What I don't want to see is a flattening. That is what is happening with Burlington Resources (BR) where the stock is just moving sideways. That is one of the reasons I buy a lot of time when opening a straddle. In the case of BR, I have the Aug expiration so, for now, I am not concerned.
I'm looking forward to a great weekend. My 9 month old granddaughter and her mom and dad just moved to some property adjacent to ours. It'll give me a chance to see more of her as she grows.
I hope your weekend is as good or better than mine.
Bill
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