From my last post I shorted TIE & OGE at their 50SMA's. I covered for a couple hundred dollar profits on both stocks, no substantial movements downward, but a pullback nonetheless.
Since, BIDU has broken out on strong volume and taken off for the skies! As of right now the stock is looking ripe for a pullback, and that's exactly where I'll be buying Call Options when this occurs. The previous resistance of $220 will certainly hold as support if the stock will even dare trade that low. Here is the chart I last posted, compared to where it is now, and my recommendation was to watch for a high volume breakout or a bounce against resistance downward, although the former was achieved.
Also my favorite pick that I've been stalking for a SHORT is NutriSystems (NTRI). The stock just couldn't muster up enough buying power to push past it's 50SMA and try to fill an earnings GAP Down from a few months before, perfect to short with relatively low risk, with a great reward profile. Take a Look!
I was a buyer of the OCT $55 Put Options as well as the $45 strike for a more aggressive play. Today the stock was down huge, to the tune of 12%, with the options spiking up 150% and 95% respectively. My Virtual Trade transactions consisted of:
September 13, 2007:
Buy 50 NTRI OCTOBER $55 Puts for $2.65 per contract (.NSIVK)
Buy 50 NTRI OCTOBER $45 Puts for $0.85 per contract (.NSIVI)
Sell 25 NTRI OCT $55 Puts for $4.70 - Profit $5,125
Sell 10 NTRI OCT $55 Puts for $5.80 - Profit $3,150
Total Realized Profit: $8,275.00
P.S. Holding remainder 15 contracts currently priced at $6.15 (unrealized - $5,175.00)
Sell 25 NTRI OCT $45 Puts for $1.50 - Profit $1,625
Sell 10 NTRI OCT $45 Puts for $1.70 - Profit $850
Sell 10 NTRI OCT $45 Puts for $1.50 - Profit $650
Total Realized Profit: $3,125.00
P.S. Holding remainder 5 contracts currently priced at $1.55 (unrealized - $350.00)
I've been trading virtually a lot lately to test strategies and gain confidence in the ideas that I'm solidifying with my research. I use Virtual Stock Exchange, Virtual Stock Exchange to buy and short stocks in individual portfolios and also CBOE Virtual Trading Tool.The CBOE has a brand new trading tool which is ABSOLUTELY AMAZING! It's powered by ThinkorSwim and also Prophet.net, Tim Knight's former website in which he developed and then sold.
6 comments:
I've been tracking NTRI as well and thought the large drop down was very interesting. Although I think it's an interesting stock I couldn't put my money long or short in it since it's way too volatile for my risk level.
I think it is a great long term buy. Buy the stock and sell the vol and you'll do well
Wheres the pic of the bull taken? Like it!
NTRI DOWN 30%, NICE TRADE 50K CALI.
The right kind of stock option trading with NTRI would also be a nice trading advice. Unfortunately, most traders don't even know that selling options is, based on winning probabilties, the better option strategy to apply.
hi cal-
thanks for the great blog! just curious where you got the brown-colored graph from? it looks awesome!
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