Friday, January 04, 2008

That was Bad

That was about as bad as it gets. The chart doesn't look that scary until you realize the Qs opened below S2, immediately fell to S3 and ended day somewhere in the neighborhood of S7. The Qs hit my intermediate low target of 49.15, and then proceeded down to an overflow 48.85. .which I (unfortunately) took as a buy signal for a modest near OTM call position. So that didn't turn out very well and to add insult to injury I picked up some more calls 10 minutes before the close. This falls into the category of a "hope" trade, or bet more than a reasoned tactical play. But with the Qs 6 days down and now at the lowest since September 19th the odds for a technical bounce (at least short term) seem reasonable. The Qs may get some follow through selling on Monday as those last few bars at the end of the day were decidedly negative. With 15 days to expiration I need any move up to happen fairly quickly as premium decay will start to kick in with a vengeance towards the end of next week.
Fortunately, I'm still 95% in cash and plan to remain so for the foreseeable future.

1 comment:

Quentin said...

I agree with the Q's being very liquid and the options are easy to get in and out of. I also trade the QID........... actually trading both of them makes trading a lot easier for me. Good blog.

Quentin