Dear Member:
All was looking pretty bullish until the 4th of July and the North Korean missile launching activities. Now, we're back to uncertainty and reservation in entering too many bullish positions. The indices turned back down again on Friday with the Nasdaq and Dow 30 retreating back to the uptrend line. The good news for the bulls is that the short term trend that began in mid-June was not broken -- yet. The SP-500 also dropped, but not to the uptrend line so far.
Each of the market tracking stocks and ETF's in which I have positions turned back down and that's not a bad thing. I still have my Dec put position on the Q's and the 110/111 bearish call spread on the Diamonds (DIA). As the indices fall, these positions are improved. I also own LEAPS calls on SPY and the tech ETF (XLK). Since the latter two look as though they may have turned down, I may well be selling calls against those long positions to bring in some income and reduce risk.
I was able to sell some Dec 5 calls against my $2.50 Jan '08 LEAPS on SIRI and that further reduced the risk in the long position and brougt me in 40 cents a share income.
The Biotech hldrs (BBH) have made a fairly strong run to a resistance and may well also be ripe to sell some shorter term calls against the longer term calls I already own.
Conoco Phillips (COP) has made a strong move up and the call side of my straddle is profitable. I'll look for signs of a downturn early next week and if that occurs, I'll consider closing the calls side of the straddle at a profit and then try for some gain on the put side with a downside move.
Many thanks for your subscription. Have a wonderful weekend.
Bill
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