Covered SLW, FRO, and WFC short puts

S&P

S&P intraday

The market broke my intraday support line today (pink line, first graph).  What appeared to be a good Monday turned out to be very disappointing.  I cleared the last of my short puts (i.e. long) about 5 seconds before the close when the market gained some footing.  These plays are purely for risk management purposes, each individual stock looks ok to me to be accumulating at this level.  But I’m in for the swing trade and it haven’t worked out.  So I’m selling them all mainly because the overall market looks weak.

To illustrate, today’s intraday market data looked particularly bad.  I thought the market would turnaround after the TICK retested a -1200 low for the day at noon on lower price, but the price continued to drift down afterward.  Then the 2pm rally didn’t even break 930 (resistance from yesterday) too.  That was the last draw for me and I decided to exit all risky positions from then on to minimize my risk.  So I covered all my options into the close.

The first of which was Dec SLW 5 put at 15:48 for $1.70, which I bought at $1.55.  I still have my 166 shares of SLW, so it’s an obvious choice for me to unload the options.  I don’t want to be too heavy on precious metal for now.  SLW is still holding the $3.4 level and marked a higher low in the afternoon.  So it’s actually looking good.

Silver Wheaton

Next I sold FRO at 15:59:27.  The low of today looks like a test of a daily trendline, pink line below on the right daily graph (Update: I forgot to attach the graph.  I added it a day later below).  I normally would have only sold if it breaks it, but again, the market looks bad.  So a retest of $30 (highest volume in recent months) seems possible.  I covered the FRO short puts bought at $7.90 for $8.00.  On another note, I mistakenly placed a sell order on the put rather than a buy (to cover) at $8.10.  So I quickly covered that accidental trade at $8.30 regardless of that fact that FRO was moving up at that time.  I’ve learned my lesson in accidental orders and would cover immediately regardless.  I won’t try to convince myself like my CAF trade.

Frontline Ltd.

Wells Fargo

I covered my Nov WFC short put bought at $3.60 for $3.00 at 15:59:55.  Fee $7.50.

I almost didn’t want to give up my WFC position.  It was the strongest and the one most profitable of my Friday’s swing trades.  In particular, last Friday’s turnaround has by far the most volume in several months.  The $28.0 support looks almost impenetrable.  Indeed, today’s low of $28.04 looks safe and we only tested it at very low volume.  Indeed, I really don’t think we’ll see this low again in the short term.  Looking at this more carefully now, maybe I should leave it open … Oh well, I can always get back in.

Related posts:

1. BOUGHT +1 FRO 100 NOV 08 35 PUT @4.20
2. SOLD -1 WFC 100 NOV 08 31 PUT @3.60
3. Sold 3 ABX 10OCT Puts 46.00 @ $4.15, Mark $43.97, Breakeven exit
4. BOUGHT +4 DELL 100 DEC 08 13 PUT @1.80
5. BOUGHT +1 ABB 100 NOV 08 12.5 PUT @1.95