Trades 2/03/10

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We had a surprise up day yesterday.  Not good for our short positions nor our put options.  

SKF sold off on the sell stop of 23.60 for a tolerable loss.  It seemed that traders were very slow to dump it as if all were thinking the market may take a turn downward as it has for the last 8 or so sessions. 

Nothing new until we see a move in one direction or another. 

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Trades 2/02/10

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Well, after so many days in the red, we finally pulled off a positive day.  For that very reason, we have sell stops on the larger positions.  SKF didn't even come close to our sell stop.  If the day starts off positive again today, the new rally of late might be believable, and we could lose that position for a tolerable loss.  My guess is that negative sentiment will resume. 

There was much positive news on QTWW and SSN today and the reaction was kept under control.

I am still looking at more short ETF positions, if we get a positive start.  The strategy as usual is to set a buy stop just above current price and follow it down until the reversal comes.  If it doesn't come, we don't enter into new positions

Current Holdings

Symbol	Security	Entry	Last	Change	Exit Plan
QTWW	Stock	1.02	0.8157	-0.2052	N/A
SSN	Stock	0.276	0.2704	-0.056	N/A
SKF	Option	24.31	24.00	+0.31	St.23.60 - GTC
TSWNH	Option	0.25	0.20	-0.05	N/A
UALNO	Option	0.10	0.02	-0.08	N/A

Updates as warranted. . .

Trades 2/01/10

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Just before 11:00AM, I set buy stops on a TS option and on SKF as suggested in my post on Friday.   Both executed and started toward the positive as the day fell apart.  I am placing a sell-stop on SKF after the first 40 minutes of trading today.  I never recommend any trades during the first 30 minutes of the day unless you plan to hold for 10 minutes - quick profit on a mover.

It's doubtful that my United Airlines options will pan out by February's expiration, but my total investment is less than 1/2 my normal sell stop for the equity itself.   

As I suggested before, risk should be kept at a minimum until we know if the bear market is here to stay.  

Symbol	Security	Entry	Last	Change	Exit Plan
QTWW	Stock	1.02	0.7301	-0.2908	N/A
SSN	Stock	0.276	0.26	-0.016	N/A
SKF	Option	24.31	24.67	+0.365	St.23.60 - GTC
TSWNH	Option	0.25	0.30	+0.05	N/A
UALNO	Option	0.10	0.02	-0.08	N/A

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Trades 1/29/10

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We finally have a positive open.  But do we believe it?  As I said before, I am completely out of the market.  The current holdings below are not generally moved by where the Dow or S&P are going.  In fact, QTWW has a tendency of moving opposite the markets and opposite regarding good/bad news.   The last time they were cited for non-compliance, the stock ran +0.20 or more if I remember correctly.

So.  It's time to take a look at buying some puts on this slight rise at open.  Regarding options, it is not wise to buy them when the underlying stock is already headed in the direction of your strike price.  We want to buy them cheap and, again, total investment should not exceed what you would normally lose on a sell-stop of the same equity. 

Take TS for example.  This one has been performing very well for a very long time.  The dow is up 75 points today and TS is up 1.20

If we believe that there is room for further downside in the markets. then we can set a limit buy for TS puts, strike 40, Feb or March (Feb. will be cheaper).  When today's peak falls apart or at a positive close, we get in.  TS will drop with the Dow or any other index.  current Feb, 40 puts are trading at.  0.36 - symbol TSWNH.   Let's set a buy limit for .25 as the market climbs today.

Symbol	Security	Entry	Last	Change	Exit Plan
QTWW	Stock	1.02	0.79	-0.2309	N/A
SSN	Stock	0.276	0.26	-0.016	N/A
UALNO	Option	0.10	0.05	-0.05	N/A

If you have a large amount of margin equity to play with you can also look at setting buy stops just above current price for the following short ETF's.  as they are dropping related to the rise in major indexes.   

SRS, SKF, QID

I regularly trade SKF and have been since just after it hit 188.00 per share last year.  If things fall apart, a small quantity of any of these can really pay off.

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