7/18 - Swing Trades...banks, banks and more banks

Now that Options Expiration is over, I'll be back to trading low-risk setups with deep-in-the-money options for the next few weeks.

I did pick up a few banks ahead of earnings next week, though. I don't hold anything into earnings unless I'm trading straddles/strangles or have risk capital I'm prepared to lose completely. In this case, it is the latter as I made some decent profits this week and think that a couple good reports may spur more short-covering next week. I also think the government has made it clear this week that they will throw everything they can at the financial crisis to prevent anything like the savings & loan debacle of the 1980's. There are 4 weeks until these options expire so even with a bad report, I should be able to get back half the cost of the options.



BAC - Earnings are on Monday, 7/21. Based on the chart below, IF BAC announces decent earnings, it may trade back to the break-down level last month of $34. I went with the Aug 30 Calls which were only $1. Buying the Aug 25 Puts for a strangle probably would have been a safer play but I like the movement and volume the past couple days and I don't want to bet against my own bank. :)

WM - Earnings are 7/22, after the market closes. I went with the Aug 8 Calls which were trading at $0.26.

WB - Earnings are 7/22, before the market opens. Here, I went with the Aug 17.5 Calls which were trading at $0.40.