Tuesday, August 21, 2012

Sell GLD strangles and Buy BRKB (sell puts)

Buy BRKB via selling Oct 77.5 puts @85.6
Story remains the same on Berkshire, chart support and a stock buyback. I was already short Sep 77.5 puts.

I also sell strangles on gold this morning. I sell the Oct 147 puts, and Oct 177 calls for credit. Again, a short strangle is a bet on a trading range. GLD is breaking out this morning with GLD@159.0. However, there is resistance at higher prices.  Chart support is at 148 and resistance at 175. So while bullish, I am not wildly bullish. Like I wrote in an earlier post, gold has been getting some positive press with the Soros and Paulson buys.

This morning's stock market rally has nudged my IWM and XRT positions back to net short. LGF had a rough Monday, perhaps because of disappointing box office results for Expendables II, but is up today on strong DVD sales for Hunger Games. Anecdotally, some are reporting the DVD is sold out at some stores.

Net long LGF
Net neutral SPY
Net short IWM XRT

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