Yesterday's morning rally was a headfake and I got taken. All those morning plus signs turned mostly red by the end of the day. Today's European central bank interest bank rate increase doesn't help. Even the positive geo-political news is ignored, so this looks ugly.
Trade
Roll down the EWJ call from 14 strike to 13 strike
Buy the EWJ Sep 14 call, sell the Sep 13 call
Thank goodness this was a small position. When the market dives, covered calls offer little protection. Flat markets or slightly up markets are the ideal environment. Rolling down, or rolling down and out is a way to update the hedge.
Precious metals and foreign stocks are getting slammed today. Bonds are offering some shelter from the storm. With relatively high money market rates, some people are parking their money.
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