Tuesday, November 29, 2011

Buy BRKB (sell puts)

Buy BRKB via selling Jan 62.5 puts, stock around 75. I open a January position, am already short Dec 62.5 puts. Logic is the same, chart support plus stock buyback.


Wednesday, November 23, 2011


Radio host Dennis Prager often talks about gratitude being the number one attribute that correlates to happiness. It isn't money, nor status, nor fame, that brings happiness. Plenty of folks have an abundance of any or all of those and still feel empty inside.

Thanksgiving is the holiday of gratitude, a time to count your blessings, to appreciate what you have. Be grateful, bless what you have and it will tend to multiply.

Let me take this post to thank all the readers, especially those that have been reading for several years. May all have a blessed and safe holiday.

Saturday, November 19, 2011

4-0 for November and Buy SPY

Four winners, zero losers for the November cycle. All are short puts: BRKB, TLT and two SPY layers.

On Friday early during the trading day, I got filled on a sale of short SPY Dec 102 puts (a bullish move, or at least a bet against a crash). I am already short SPY Dec 99 puts. Going forward I am still clear of GLD, short bonds, cautiously long on stocks.


Friday, November 11, 2011

Buy TBT (sell puts)

Buy TBT (2x inverse bond ETF) via selling Dec 18 puts. With the news background, U.S. bonds are getting a bump up. TBT 18 marks about the top of the bond market rally, though there is the decay in the 2x inverse fund.

I don't have much insight on the stock market smash on Wednesday. Obviously, my most recent sale of SPY puts were at a bad time. Sell a lot of puts, like I do, and it happens. Hopefully, not that often, though.


Tuesday, November 08, 2011

Buy SPY (sell puts)

Buy SPY via selling Dec 99 puts. I open a December SPY position, with a low risk, way out of the money sale of puts. Again, there are multiple support levels in between current prices and the strike price. It would take a lot to cut through all that support and there is Thanksgiving and Veterans Day coming up to slow trading and reduce volatility.

This is another order before the open that fills early in the trading day. I don't get near the best price of the day, but by the end of the day, I am in the green.


Monday, November 07, 2011

Buy BRKB (sell puts)

Buy BRKB via selling Dec 62.5 puts. Same arguments as before, chart support and a stock-buyback make a steep decline unlikely. BRKB in the 77 range.

Gold had a huge rally day. I make a bearish post about GLD and wow.


Sunday, November 06, 2011

Trading without live quotes and a Bearish GLD chart

Most of the time, I place an order to sell at the bid, or buy at the ask, and most of the time get a fill within seconds. The last few weeks I haven't had access during market hours. This means placing orders before the open. Market orders on options often get the shaft at the open. So I am trying to guess a theoretical option price based on the opening bid and ask indications, and the possible low and high for the day.

Trading without a live bid/ask quote has made me more patient, even more cautious. I haven't tried any spread orders or backratios during this time period.

I can make a quick comment on the GLD chart, it looks about as bearish as I have seen it in recent memory. I remain long term bullish on gold, so am reluctant to short it. Those without that bullish gold bias might take a look at the short side. If I were to take a short position, my choices tend towards a bearish calendar put spread, or a bearish vertical put spread. I dislike straight buying of puts, though there are pluses and minuses to each choice.

Here is the 6 month chart for gold (GLD @170.8 Friday). The modest rally off support, moving into resistance on lower volume looks like a text-book example of a rally ready to fail.

Friday, November 04, 2011

Hulbert: bear market rally

Mark Hulbert on Marketwatch writes about sentiment during this recent rally (link).

>>The unfortunate conclusion is that the Oct. 4 lows are likely to be broken.

Too many stock advisers have been buying into the rally. That is the conundrum of the markets, when too many folks are on one side, the majority often ends up being wrong, especially at the turns.

Wednesday, November 02, 2011

Buy SPY (sell puts)

I place a limit order before the open to sell SPY Nov 107 puts, and get filled right at the open. I have a hard time seeing a scenario that crashes the stock market below the recent lows before November expiration.