7/23 Swingtrades - BAC, WB, LEH, SHLD

There was a nice follow-through run-up in the financials in the AM. I was not quick enough to catch the top but still made some decent profits off this rally. As I mentioned on a previous post, I still think there is bad news out there but with the government jumping in, high short interest and oil getting obliterated, max pain will be dealt to the shorts for now. Here are my trades today:


BAC - Tried rolling position into Aug 35 calls but sold them out flat as financials weakened
Bought @ 26.97,
Sold @ 33.10
Profit - $3.00 on Aug 30 Calls

WB - Sold a bit early but still a tidy profit
Bought @ 12.90 & 14.90 (luckily, cost was $0.40 both times so I was able to pick up quite a bit)
Sold @ 18.00
Profit - $1.60 on Aug 17.5 Calls

LEH - I bought, sold and bought again. It showing some strength but I may be chasing it too much. I'm holding the Aug 17.5 Calls

SHLD - Per this morning's post, I missed the break-out in SHLD. However, later in the day, it retraced perfectly to the break-out point of $77.00 and rebounded.

Bought @ 77.80, Aug 80 Call (I went with out-of-the-money calls because the stock is volatile and I'm not ready to get shaken out on a $5 swing.

Pyramid @ 80.55, Aug 85 Call

Risk @ 75.00

7/22 Day Trades - GS, ENER, BAC

As expected, the market opened up very weak following yesterday's slew of disappointing tech earnings. However, it wasn't long before buyers came right back in. If you were nimble enough to buy the weakness, you were very handsomelly rewarded at the close. I took the following trades:

BAC - I bought these calls for both a daytrade and swingtrade. Again, a nice narrow range offering a low-risk entry. As you'll see, I anticipated the break-out too early and my daytrade got stopped out. Jamie from Wall St. Warrior likes to enter following a hammer that flushes out the weak hands prior to the break-out. I was the weak hand for this position today...
Bought @ 30.10, Aug 25 Call
Risk @ 29.90
Sold @ 29.90
Loss - $0.30 on the Calls - I was holding 50 Calls thereby leaving $10k+ on the table. Damn, I thought I could catch Trader Stewie with this one! :)

On a brighter note...I also doubled-up on my Aug 30 swing trade position planning to hold overnight but sold on the strength at the close:
Bought @ 30.10, Aug 30 Call
Risk @ 29.90
Sold @ 32.50
Profit - 1.45 on the calls

ENER - A semi-hat-tip to the traders at Wallstreak.com. I entered on the break of the opening range low (66.00) but the stock found support at 65.00 with the reversal hammer so I tightened up my stop and took a loss:
Bought @ 66.00, Aug 85 Put
Risk @ 66.50
Sold @ 66.10
Loss - $0.20 on puts

GS - I found a semi-low risk entry on the break of $183.50:
Bought @ 183.50, Aug 160 Calls
Risk @ 181.90
Sold @ 187.00
Profit - $3.00 on calls

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.

7/17 Day-Trades

It was a very busy day. As expected, with the help of JPM earnings, short covering in financials carried into the open. Unfortunately for me, I woke up right at the market open so was frantically getting the trading platform up on the screens. As it turned out, all my overnight postions gapped open. However, by the time I made my way through selling the positions, I had left about $8k on the table. Luckily, I started with BAC which was my largest position in terms of contracts...it also gapped up the most. Lesson for today will be to use automated trailing stops on these ONH set-ups.

BAC - Switched to the 1-min chart at the open and sold on weakness
Bought @ $21.50, Jul 22.5 Calls ($0.36 cost...very cheap, minimal risk)
Risk @ $0.00
Sold @ $25.50
Profit - $2.70 on calls
Re-entered after break of consolidation
Bought @ $24.50
Risk @ $23.90
Sold @ $26.00
Profit - $1.50 on calls

FNM
Bought @ $9.50, Jul 10 Calls
Risk - @ $0.00
Sold @ $11.50 (yes, very shitty when you look at that highs on the chart)
Profit - $1.30 on calls

LEH - I had too many positions to sell. By the time I got to this, it had already come down. I will use automatic trailing stops next time.
Bought @ $16.50, Jul 17.5 Calls
Risk @ $0.00
Sold @ $17.50
Profit - $0.50 on calls

WFC - I had rolled my profits yesterday from Jul 25 Calls to Jul 27.5 Calls. I was much more liberal with these and placed stops on them last night. Again, trailing stops would have been better.
Bought @ $27.00
Risk @ $0.00
Sold @ $26.40
Loss - $0.15 on calls

OIH - Energy stocks were weak after the surprise build in natural gas. I went with OIH as most other stocks had already begun the move down.
Bought @ $199.50, Jul 195 Puts
Risk @ $200.10,
Sold @ $195.00
Profit - $1.50 on puts

BIDU - Another false break-out. I need to stop chasing this one.
Bought @ $305.00, Jul 270 Call
Risk @ $303.00, moved to 303.90
Sold @ $303.90
Loss - $1.10 on Calls

7/16 Day/Swing Trades

Today was an excellent day to take advantage of options expiration on Friday. As expiration nears, option premiums dry up resulting in a lot of low-risk set-ups. The big news today was Wells Fargo beating earnings estimates and RAISING the dividend. Given the fear and weakness in the financials lately, I instantly knew that this could lead to some serious short-covering in the financials...the theory being maybe the capital markets aren't as bad as everyone thinks. That's the theory. I personally think things will be getting worse but that won't prevent me from taking advantage of the market fear and greed. In addition to the trades below, I'm holding LEH 17.5 Calls, FNM 10 Calls, WFC 27.5 Calls and BAC 22.5 Calls. These are all overnight holds in case the short-covering in financials spills into the AM.

WFC
WFC I pulled up the option chain at the open and saw the July 25's asking $0.45. Would I risk $0.45 for WFC to get to $25.45 by Friday...hell yeah! I'm in. Again, this takes advantage of the low premium prior to expiration. Worst case, I lose $0.45 per call, well within my usual $1.00 stop parameter.

Bought Jul 25 Calls w/ stock at $24.50
Stop @ $0
Sold @ 27.00
Profit - $1.75 on Calls
Still holding Jul 27.5 Calls for further short squeeze

BIDU
I should have placed a more liberal stop. I got stopped out before it ran...

Bought @ 291.00 w/ Jul 240 Calls

Stop @ $289.90, moved to $292.90

Sold @ 292.90

Profit - $1.30 on Calls

OIH

Unsuccessfully chased drop in oil...

Bought @ 197.80 w/ Jul 210 Puts

Stop @ 198.50, moved to 198.30

Sold @ 198.30

Loss - $0.50 on Puts

ONXX Swingtrade
As I mentioned in a previous post, biotech has been the hot sector. ONXX had resistance at $40.00 which it broke today. I'm not thrilled with the volume today but it held up fine into the close so I'll keep evaluating my stop levels over the next couple of days.

Bought @ 40.88
Stop @ 40.50

Still holding...