What a fantastic week!

Just when I thought I was starting to lose my mind, after two “Fuhgeddaboudit” Fridays in a row we finally found a problem(s) that investors could not simply ignore.  Only a week ago, we had to have a philosophical debate as to whether we should take profits on our 566% plays off the table at “just” 300% – THAT’s how insanely bullish people were 7 days ago.  Fortunately, we made the correct call (and how is taking profits off the table at 300% ever a wrong call?) and this week, no one argued at all when we killed a similar play on Thursday with “just” 200% profits as we anticipated a lower high and no third Fuhgeddaboudit Friday in a row.

We had 72 trade ideas for members last week and our 16 losing trades were, of course, mainly our downside hedges.  We cashed out our bull side winners Tuesday morning and that left us very bearish and look how well channel trading has played out for us as now our “losers” are, for the most part, losers no more:

  • GS 2012 $70 puts at $2 (fell to $1.91), now $4 – up 100%
  • AAPL May $260s sold at $3.60 (rose to $14.20 and were split to 2 June $270 puts), now $13.80 – down 283% (part of a pair trade)
  • GSK 2012 $40/45 bull call spread at $1.60 (fell to $1.30), now $1.75 – up 10%
  • OIH $131 calls sold for $3.45 (rose to $3.80), now $1.65 – up 52%
  • LEG May $22.50 puts at .50, out at .20 (now .10) – down 60%
  • NFLX May $95 calls sold at $2.60 (rose to $7), now $6.40 – down 146% (part of a backspread)
  • NFLX June $115 calls at $1.45 (fell to $1.25), now $2.10 – up 44% (new cover for backspread)
  • SBUX $24 puts for .38 (out at .10), now .15 – down 60%
  • TZA June $6 puts sold for .70 (rose to .94), now .47 – up 32%
  • VNO May $80 calls sold at $2.30 (rose to $3.90), now $4.60 – down 100%
  • IYR May $52 puts at $1.30 (fell to .79), now $1.20 – down 8%
  • TNA May $69 calls sold for $3.10 (rose to $5.10), now $2.05 – up 34%
  • QID May $16 calls at .32 (fell to .27), now .53 – up 65%
  • QID May $15 puts sold for .32 (rose to .37), now .16 – up 50% (pair trade)
  • GOOG Sept $750 calls for $1.10, now $85 – down 22%
  • GOOG May $590 call sold for $1.85, now .75 – up 60% (pair trade, 5:1)

I often say to new Members, especially those with smaller portfolios,…
continue reading