Thursday, August 3, 2017

Closed EEM Long Calls to Take Profit as the Option Delta Reached Target

Yesterday, I closed the EEM long call (2018 January 19 $38 LEAPS) when EEM was dropping near its $44 resistance after I found out its Delta reached 0.86 which was over the target of 0.80 as described in the original post (Bought top performing emerging market ETF) when the position was entered over 3 months ago.

I did not roll out the long call to take profit and to remain in the position, because EEM had been rising in the up-trending channel in the last 5 months as shown in the chart below. I’d like to wait for the next EEM opportunity when it rests for a while.

Looking at my last trades on EEM, I had got out of a short call July 7 $41.5 on June 26 as it popped out of an ascending triangle as I described in a chart of a prior post and shown below. Since then, EEM pulled back to the triangle but did not trigger a new signal for selling another call. So, I was lucky to capture fast move of EEM in the last 4 weeks.

For EPI long stock position, I’ll continue to follow my plan to exit when it breaks 20+ day support that I identify along the way and the profit target exit will be the uptrend shows signs of ending or when the general market start to show weakness.

During my multi-week summer vacation, I had a few trades on the SPY & QQQ while I kept a minimal number of positions. I’ll document those trades later and look to expand my positions as market conditions allow since I’m back and able to handle the portfolios actively.

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