[caption id="attachment_683" align="aligncenter" width="500" caption="Frontline Ltd."][/caption]
Pretty much the same reasons as my SAP trade executed at about the same time. I am short term bullish on the broad market and picked these two companies (SAP and FRO) as my champions to ride the wave.
I tried to go long last Friday with FRO but were stopped out. Today is another day and another dip in the water. The orderly selling in the market is acceptable so far. We could either drift lower or rocket up higher. I have lowered my strike to 35 (used 40 last Friday) to reduce the risk.
Upside: Unfilled gap above \$41. Reverse head and shoulder forming.
Resistance: 50 dma and head-shoulder neck of \$40.
Downside: Still in downtrend. Broad market may still be in down leg of trading range to 850.
Support: 10/28 high of \$30
Bottom line: FRO is trading at \$32. Upside/downside ratio is about 4 to 1. Plus I'm short term bullish on the broad market.