Sold 6 CM 10OCT Put 74.00 @ 6.60 Mark $70.70, +8.0%

By Paul | Published: June 8, 2010

The market seem ready to crack but it is not.  So I am taking profit on my CIBC short here on a weaker volumn retest of the $70.50 support (Figure 1).  I bought 3 puts contracts four weeks ago at $5.00 when CM was trading at $74.02.  Then I added 3 more contracts with the same strike price and expiry for $5.65 when CM was trading at $72.30.  The average cost was $5.35.  Thus, profit is $750 – ($12.95 + $3.00) x 2 = $718.10 = 8.0% of total account.

CIBC (CM.TO) intraday

This is the last of my positions.  I have no more outstanding position in any market.

CM.TO looks to be on the brink of a collapse.  I may be making a mistake here by offloading my shorts before the fireworks.  However, as I was saying, the market is still hanging on.  Furthermore, there’s a positive divergence for CM.TO as shown on Figure 2 according to the oscillator at the top of the chart.

So I am taking profit now to reduce my risk as this position is relatively big for my small RRSP trading account.

CIBC (CM.TO) daily chart

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Related posts:

  1. Sold 3 ABX 10OCT Puts 46.00 @ $4.15, Mark $43.97, Breakeven exit
  2. Bought 3 CM 10OCT Puts 74.00 @ 5.65, Mark 72.30
  3. Bought 3 CM.TO 10Oct Puts @ 5.00, Mark $74.02
  4. Sold 4 MFC 10OCT Puts 17.00 @ @1.43, Mark $16.27, Loss -0.5%
  5. Sold 12 CVE.TO Puts @ 2.90 Mark $27.50, +10% gain
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