Wednesday, July 9, 2008

Due to the recent market volatility and weakness, I've mainly been in daytrade mode. I'm only holding AMGN and DNA for swing trades. I entered AMGN July 42.5 Calls on 6/23. Despite the overall market weakness, RSI, MACD and On-Balance Volumer were all increasing. As it turned out, AMGN has been bucking the trend, moving up on market down days. I've been using the strength to take profits and to roll my options to July 50 Calls. At this point, I'm just riding the trend and trailing my stops as I've taken enough profits to cover the initial investment 2x. The beauty of options is that with the July 50's, AMGN can gap down below $50 but my losses will be limited to the initial investment, which was ridiculuously low ($0.50 per call). I'd still walk away with $10k+ profits.

No comments: