Monday, June 24, 2013

Status of my bull positions

In my analysis today of  PBYI, I included a two-graf sidebar on my bull holdings to illustrate the bearish bias of the market.

What a fickle friend the market is when it comes to supporting an argument!

In the analysis I wrote:
The strength of the bearish bias noted in item 3 can be seen in my bullish holdings opened before the downtrend began. I have five bull positions left. MPEL gave an exit signal on Friday, and both QIHU and SBUX did so today. It is a sad and lonely time to be a bull.
(The three giving exit signals are structured as short vertical options spreads and so I'll be getting out in a tactical fashion. See my post "How I exit hedged positions". The remaining two, CLB and SEP, are long shares and haven't given an exit signal.)
As the trading day draws to a close, QIHU and SBUX have retreated to the upside, pulling above their signal levels. Since my trading relies on closing prices, the interim exit signals on QIHU and SBUX are   invalid and I'm no longer actively seeking a decent exit point.

MPEL remains well below is exit signals. However, according to the calculations described in "How I exit..." linked to above, the potential reward between now and expiration is more than double the potential risk; 2.01x, to be exact. So MPEL is a hold for now.

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