Thursday, October 13, 2011

10/13 Covered Calls

This daily posting tracks my covered call plays for October and other base positions.

BIDU, CNX, COG, HAL, KEG, NOV, TKR and TPX showing very near term lower highs and lows, each initiating a downtrend.

JNJ showing a sideways trend.

With less than two weeks until expiration, I'll be looking to buy some insurance puts.

My new method of counting trends (see the note on Wednesday’s Covered Calls report) results in very near term calls. It captures right now, but loses sight of the broader trend. One solution would be use channels to determine the trend. If I can draw channel on a week’s price movement, I can determine from that whether the broader trend is up, down or sideways. On the other hand, the very near term counts. A single day’s reversal almost always results in several days of reversal. A very difficult set of behaviors to define because of the fractal nature of price fluctuations.

Covered Calls

sym phase trend adx   200/50 40/10

Other Base Positions

  • None.


  • phase: 20-day price channel phase, with green for bull trend, red for bear trend and yellow for neutral trend.
  • trend: Price direction, green for higher highs and higher lows, red for lower highs and lower lows, yellow for sideways, and grey for neutral or ambiguous.
  • adx: Average directional index location, indicating the strength, or the temperature, of the trend. Orange for 40 or greater, aqua (light blue) for 25 and up but below 40, magenta (light purple) for 20 and up but below 25, and brown for anything below 20. (Mnemonic: Orange for the overhead sun, blue for the surrounding sky, magenta for sunset on the horizon and brown for the earth.)
  • 200/50: The moving average cross, green for the 50-day ma above the 200, red for below and yellow for closely aligned.
  • 40/10: The moving average cross, green for the 10-day ma above the 40, red for below and yellow for closely aligned.

About my trading methods

Read a detailed explanation of my analysis method, including trading rules. These don't, at present, discuss my covered call strategy, which is under revision.


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

The trader’s greatest sin is inaction. Sleeper, awake! Seize the Nietzchean moment. Roll out of bed and trade.

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