Hi:
I wish we can post charts here.
Are you writing calls or puts?
At this point, I will be selling my covered calls, buying more calls and "selling" those 130 puts. I expect QCOM to get a feeble bounce from here to around 130 gap.
Call Imp volatility for QCOM is at 93, puts are at 77. With such high volatility, selling options makes more sense than buying them. But then, I am a short term, aggressive trader. I will have GTC orders in place to cover both the positions at a profit.
QCOM 120 calls I sold for $19 1/2 are now at 5 1/8x5 1/2. I plan to buy them back, twice the number I am currently short. February 130 puts closed at 22 1/4. A trade of selling those puts and buying calls will be a nice trade if one is to catch the bounce. I will close both the positions at whatever profit I can get (Expect at least 25% on both sides), if QCOM breaks Friday's low of 105 or prior to the Fed meeting, whichever comes first. I believe support for QCOM is close by in 95-100 area.
You must not be touching such a trade if you do not have capability of monitoring intraday charts or you are not able to get out quickly if the trade goes against you. You also can not take this trade if you are working with limited capital.
Markets are waaay oversold and a relief rally after the Fed meeting is quite likely.
Boy, I wish we can post those charts on SI!
Regards:
GP
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