The Options Box

[smchan]

David,

I'll share my dumb play of the day from last week. When I sold my September calls a couple weeks ago, I saw a bearish descending wedge on SNDK (or at least I think that's what it's called), so I sold a deep ITM call (September 20). Well, the price lost support as expected but, like a dummy, I covered the call when I thought the descending wedge might fail a few days ago.

http://stockcharts.com/def/servlet/SC.web?c=SNDK,uu[m,a]daclyymy[pb50!b200!a21.50][vc60][iUb13!La12,...

I'll look to sell a September or October when the underlying is near 21.50 which I think will be resistance. Other than my dumb move above, SNDK has been good to me. My original basis from Jun 26 is $23.35, and I've earned a net $5.40 in premiums from selling and covering (either thru expiration or buying back) 4 times, and I'm currently uncovered.

Another that has me worried buy may work out: VRTY. I went long at 14.35 and sold the Sept 12.5 call for $4.00 on a bounce that same day. Unfortunately, they warned 2 days later (see that gap?) but have been slowly uptrending since.

http://stockcharts.com/def/servlet/SC.web?c=vrty,uu[m,a]daclyymy[pb50!b200!a21.50][vc60][iUb13!La12,...


Sam