March 5-6, 2008 – Cutting some weight, making adjustments

Exited some shorts. and looking for some other opportunity today. Unemployment report on Friday.


As per my plan from yesterday, I exited some short positions.
Both ATI and ENR Drove higher at the open. I waited for 5 minutes and waited for the opening pullback and covered my positions into it. I am pleased with that decision. With employment coming out on Friday I don’t want to have too much directional exposure either way.
Again my gut is telling me we have moved down 700+ Dow Points in 5 days. And the market is finding strength with any good news. (The Charlie Gasperino 3pm Ambak put story may be running out of gas in the future).
Sells:
ENR – May 100/85p for 7.25 @ 93.03. Re-entries around 95.
ATI- APR 80/70p for 5.10 @ 74.75. I will look for re-entries between 79.35 and 80.78
Buys:
DFR – Bought 600sh @ 2.86. There was a huge 687 lot order @ 2.85. I was leaning on that, and a previous low of 2.84. I am looking at this as nothing more than a quick daytrade.
I got out @ 2.97. The upward move stalled. And I think we will have a buy the rumor, sell the news reaction on ABK (mortgage insurer).
It was a goofy, do nothing day. As I sit, an hour from the close. I am happy to be mildly long. Delta positive 460, Theta positive 170. And up about 1% on the day.
Thursday –
I just have about an hour to adjust and put a few trades on.
Basically, with the ABK info out (dud), and talk of a few credit defaults has tempered my short term bullish outlook. I want to see how the market reacts off the open. SP futures were down 12 in the premarket. 7 at the open. The SP ended down 29, Dow was down 220. NDX 50. The market is broken. It is a crazy place right now. Look out below.
AIG – I just locked in my profit on AIG today with a March to April roll of my short strike for 1.05 and 1.07. I bought the original Mar/May 45p calendar for 1.02. Now I have the April/May 45p calendar on. I was a little nervous with this break to all-time lows in AIG. This gives me some time to wait and let volatility settle down.
MRVL – Sold 1 unit of Mar/May 10p for .34. This would have been much better in the morning, but I wanted to take some risk off the table. I think 85 spreads is enough.
My P/L is getting pounded right now, mostly in UST, MSFT, and T. But I am ok with it. In fact, I am looking to create new Apr/July positions in UST.
Tomorrow morning’s job report will be very pivotal. With all the negative talk, I think we may have a huge gap down, then I would like to dump my short positions and fade the move. We will see though. Very interesting.

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