QQQ had turbulent
4 days after I uncovered its short call on last Friday June 23. On the
subsequent Monday of June 26, QQQ presented a bearish dark cloud cover candle
and fell hard for the next day. It tried to rebound on the 3rd day
/w lower volume. On this 4th day, it got hammered again on high
volume and undercut the support line around $137.
Looking at other
QQQ chart indicators that I use typically, MACD turned down for the again but the new high – new low indicator is still up. Since QQQ
showed me the bearish chart pattern, declining MACD and the distributive volume
behavior, I decided to sell to close my QQQ September 29 $135 call in my
shorter term trading account today for $5.73. For my longer term trading
account, I sold the July 21 $140 call for $1.01 against the long option. The short call strike had Delta around 0.30
which reduced the position delta as a hedge procedure.
On the SPY
side, it was sold off today too. However, it had not broken down the lower support
line of the up-trending channel yet. I have a July 7 $244.5 call which still
has a value around $.20. I plan to roll down if SPY continues to fall tomorrow.
It’s not a complete market plunge as the financial ETF’s XLF/KRE did rise.
Citigroup
popped out of recent range along with its peers in high volume. I rolled up the
July 7 $66 call to July 21 $69 Call for a debit of $0.94, rather than make it
naked. My thought was that the weak market may limit the rise of financial
stocks as well.
For MU
diagonal spread, I exited the position for a credit of $5.32 two days ago on Tuesday
June 22, after it touched the recent high and pulled back. My rule is to exit before
its earning’s announcement which happens to be today. This rule is used to
reduce risk of my portfolio.
For EEM, it broke out of resistance on Monday, June 26. I bought back the short call July 7 $41.4 for $0.60. Since that, it pulled back but the MACD hasn’t dropped for 2 days in a roll yet. I may have to short another call if EEM price drops tomorrow.
No comments:
Post a Comment