Traders Corner   17 comments

Did Friday happen? It’s hard to tell from the technicals, which don’t look much different than they did Friday morning.

The S&P 500 levels to watch today:

UPSIDE: 1713 (top of the Bollinger Bands).
LAST CLOSE: 1692, inside the 1692-1693 (2 data points and the all-time high) range.
DOWNSIDE: 1683-1684 (4 data points), 1680-1681 (2 data points), 1676-1677 (3 data points), 1671-1672 (2 data points and the 10 day moving average), 1657 (2 data points), 1654 (July 9th’s high and June’s high), 1647 (July 10th’s low), 1644 (July 8th’s high), 1642 (July 9th’s low), 1639 (50 day moving average), 1638 (20 day moving average), 1634 (July 8th’s low), 1632 (July 5th’s high), 1622-1626 (9 data points), 1618 (July 3rd’s high), 1614 (July 5th’s low), 1606-1610 (2 data points), 1604 (July 3rd’s low), 1597 (April’s high), 1581 (May’s low), 1572 (March’s high), 1564 (bottom of the Bollinger Bands), 1560 (June’s low), 1536 (April’s low), 1530 (February’s high), and 1524 (200 day moving average).

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Posted July 22, 2013 by edmcgon in Daytrading, Investing, Market Analysis

17 responses to “Traders Corner

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  1. I’m not comfortable buying UCO at this price. I don’t want to sell out of the money calls and the premium on the in the money are not high enough to justify the risk. My approach to playing UCO worked great as long as it stayed within a fairly tight trading range. Since that has changed, I’ll just watch for now. As an alternative, I have started to buy TNA and sell weekly covered calls. I had two positions called on Friday. Both were profitable. 1.7% for 5 days and 1.0% for 2 days. I bought TNA again this morning at 59.06 and sold the weekly 59’s at 1.21. If I’m called out on Friday my profit will be 59.06-1.21=57.85 net cost. Profit =1.15 2.0% The markets look overbought but in this crazy market who knows. As long as these no nothing days continue, this is a conservative play that will give me a decent return. If TNA continues higher no problem. If we do start to turn down, I’m not locked into anything for more than a few days. With this part of my portfolio, I’m looking to beat dividend plays without taking on a lot of risk. You have to be flexible and take what the market will give you. If you are interested in weekly calls you can find a list of etf’s and stocks at the CBOE.

    • Trader, thanks for the update. You always explain in a very logical way your market moves — no guessing or gambling on your part just a realistic review of what you believe is happening and how you will respond and typically with an “out” should it go differently than what you think is going to happen.

  2. Great strategy Trader. Thanks for our thoughts

  3. Another one of my smart buys, ALSK, is up 25%+ this morning. Only another 50% and I am back to even not counting potential lost gains if the money was invested in a winner.

  4. My SAND is up close to 9% today. What a great country

  5. For you NUGT players, technicals are starting to look better. If we can break above 8ish there is some resistance in the 9 to 10 range although not strong. If we break that, next stop looks around 12 and stronger resistance there. I think the 8 level is key. If we can’t break that, then we probably aren’t going anywhere in the near term.

    • Thanks for your thoughts on NUGT. Should it hit $12 (+50% from current price) all I need is for NUGT to then double and then go up another 75% and I will be out with the money I spent to purchase it!

  6. Ed

    You didn’t think INTC would get under $23 a share. Now that it is are you looking at buying?

    • I’m looking at it. I want it at $22.50 or less.

      • Buy it at its current price of 22.78. Sell the 23 weekly calls for .30 and you’ll own it a 22.48. If you get called out, do it again next week. Intel doesn’t move a lot so it is a perfect candidate for weekly calls.

      • Oops, screwed up. My screen was on the August options. Weekly 23’s are bid at .12. Still not a bad return for the week if you are called. 22.78-.12=22.66. Called out at 23 for a profit of .34 1.5%

      • Trader,
        I’m looking at it for my long-term portfolio. Intel is too good of a stock for a quick turnaround, unless it drops below $20.

        Anyway, you know I don’t do options.

      • I know you don’t. Might be of interest to other Intel players. For those who are interested you might want to paper trade this approach. With a stock like Intel which is not very volatile, my guess is your return will be better than buy and hold. Look at selling slightly out of the money calls. If you are called on out Friday, compute your yield on that position. Buy Intel again on Monday and immediately sell slightly out of the money calls again. If you are not called out sell calls above your adjusted basis. It will take a little work but you should get paid. Keep in mind that you have to own 100 shares to sell one contract.

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