6/18 – Digestion

The markets seem to be digesting the past two weeks of radical action. I made a few small missteps of the past few weeks, however when all is said and done, the portfolio is up.


The markets seem to be digesting the past two weeks of radical action. I made a few small missteps of the past few weeks, however when all is said and done, the portfolio is up.
The up portfolio is mainly due to some nice doubles in a few trades.
COGN is up 150% in the past few weeks. This has been a nice calendar. The only downside, was that I only put on one unit.
AMTD is up. I took off half my position last week for a double, I will let the other half decay toward July Expiration.
STLD is working out very nicely. The spread has widened with a drop in front month Vol. Up 50% so far. I will let this continue to decay. There is alot of premium in the front month option.
CREE – This morning I added greatly to this position. I put my 30c hedge in place for .01, and I picked up 4 units this morning. That is right .01 per spread. There is $1.30 of premium in the front month option. And I paid .01 for it. I am looking for a widening of this spread over the next few months. I have not found any news about this, however last summer this was the time to find these spreads. I am guessing there are people out there who buy the Dec contracts for a 6 month play. The prop the Dec options, and the Jan options spread stays in place. I have found this to be a very interesting happening. The Reward to Risk my entire position, including hedges is 9:1.
FXI- The chinese index has exploded. It is pretty awesome to watch this index march. I have no position.
I am very cautious to enter directional plays right now. My directional plays of late have turned to poop. I believe this is because I am using a discretionary strategy (looking for “well” known patterns) and I am loosing on them. I have used Profit Source for some EW setup trades, and 3 of 4 have been dead on. The loser was $60, and the winners have exceeded $1000. I’d call that a clue.
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Goldman downgraded BTU and the coals today. I have been stalking these over the past few days as a W4 buy. I will look in the morning. I don’t really believe the analysts anyway. The public sure doesn’t pay the Goldman analysts to make recommendations to make the public money. They are out there to make Goldman money. I want to put on a August 55/60/65cbutterfly for BTU. There is some great opportunity. I found a trade with a very conservative 7:1 Reward to risk. I am looking to see what happens with the support. We will see.

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