Tuesday, April 20, 2010

Buy SPY (sell puts)

Buy SPY via selling Jun 100 puts, SPY @120.8. Today's action looks like short covering. There is support at Friday's lows because short sellers piled in on the hard down day. I already am short SPY May 96 puts, but they are getting close to delta zero, as what I have called a "ridiculous rally" rolls on.

There will come a time that selling puts becomes the absolute worst thing to do. For the stock market, that time is more likely to be September/October than today.

Long GLD, SPY, TLT

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