Saturday, April 25, 2015

Weekly: new highs

New highs might be in a tiny font because the fanfare is subdued. While there are stirrings of the public getting in, most people on the street still have a tepid attitude towards what has been one of the great bull markets. Some big company earnings came out this week. I did okay with my FB earnings play, new longs in SKX STJ, new short strangles in CAT HAR KORS LOCO UA. (p = puts, c = calls, sell means sell-to-open, all are third week expiration unless noted).

Fri Sell FB May 88 c @82.1. I hedge the May 75 puts I sold a while ago, by selling calls. This gets me to near neutral. The big up days in AMZN, GOOG, MSFT likely means a lot more attention for those stocks and less for Facebook.

Thu Close FB backratio @83.9: sell May 85 c / buy 2x May 90 c
FB earnings a bit disappointing. I was hoping for a couple of bucks of rally. I see any profit when buying premium going into earnings as a good thing, so I get out very early in the day for about a 45% profit after the substantial commissions. Using a baseball analogy, I swung hard, and ended up with a bloop single off the end of the bat. It looks like I could have done better by waiting 20 minutes as FB goes green for the day. If my "bad trades" are coming in at +45% it is going to be a great year. The three other FB legs where I sold premium doing great on the flat report.

Sell CAT May 80 p @86.2 New long position in Caterpillar. CAT up on earnings. Not much premium in these puts, but I am giving myself some room. About an hour later, CAT now in the red, I sell May 89 c @84.2 19 to turn it into a short strangle. Another earnings pop that turns into a flop. Grrr.

Sell HAR May 125 p @147.1. Rebalance short strangles in Harmon Intl car audio supplier. HAR continues to move up after its break out on earnings.

Sell SKX May 80 p @86.2. New long position in Sketchers (sneakers). SKX up on earnings, followed by two analyst upgrades. Another pretty chart formation.

Wed Sell FXI Jun 45 p @52.2. Rebalance my position in the large cap China etf by opening a June position. On the chart, 45 is the 50 day moving average.

Sell STJ May 70 p @73.1. New long position in St. Jude Medical. STJ up on earnings. The chart is a beautiful text-book breakout pattern from a flat base.

Sell UNH May 125 c @117.5. Rebalance short strangles in United Healthcare. UNH not acting well. Recent high is 123.8.

Tue Sell FB May 75 p @84.3. Rebalance a complicated position in Facebook, back to net long, as FB rallies ahead of earnings.

Sell PANW May 135 p @149.9. Rebalance short strangles on Palo Alto Networks as it breaks out from a chart base. This gets me to net long.

Sell BRKB Jun 130 p @142.1. Add to longs by opening a June position in Berkshire Hathaway.

Sell FXI May 46.5 p @51.7. Rebalance short strangles in the large cap China ETF as it bumps higher.

Sell UA strangles: May 75 p / May 90 c @84.0.
New short strangle with a bearish slant on Under Armor. UA down after earnings.

Sell KORS May 67.5 c @62.4 23. I hedge yesterday's newly sold puts by selling calls on Michael Kors.

Mon Sell HAR strangles: May 120 p / May 165 c @143.2
Harmon International, car audio supplier is up after an analyst upgrade. Earnings due out in early May so volatility is elevated on the May options. A short strangle is a bet on a trading range.

Sell LOCO strangles: Jun 23 p / Jun 35 c @28.7
El Pollo Loco is a regional restaurant chain. I like the 23 price point on the chart. LOCO a bit extended on the upside so I hedge by selling otm calls.

Sell KORS May 60 p @62.0. New long position in Michael Kors, clothes, purses, accessories. KORS down on analyst downgrade. Chart looks like it may be capitulation, with another down day on the news, after a long down trend. This is much closer in than I tend to sell puts.

Position Summary:

net short: JWN UNH

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