As long as we're doing the "Real Case Study" part, I really like hearing about trades as they happen, and Tuck, it is much appreciated. In case anyone remembers, I got into NOVL on a dip Friday at 23. I put in an order to sell the Aug 25 @ 2.5, never got hit. NOVL RSI is rising, and it looks as if it will bounce off somewhere around 25. This morning I put in an order to sell the same Aug 25s at 2.75. I got hit almost immediately. I also put in an order to buy the June 20 puts at 3/8. Unless NOVL gets close to 25, I might not get them at this price. That's ok, I don't want to pay more than that for protection at this point. Besides, I see the current 15 min. delay, and RSI is dropping like a stone, while the price is not following suit. It is evening out, coming down a little. This may mean another surge to 25 or above, where resistance seems to be. Here is my current situation, and plan if all goes well.
700 shares NOVL @ 23 (Purchased on 5/7/99)
Sold Aug 25 Calls @ 2.75 (5/10/99)
Order to buy 7 June 20 puts @ 3/8 (5/10/99)
Nut: $20.25,
Nut with puts $20 5/8
current price 24 3/8
My plan is get the puts and sell them when stock pulls back (if it pulls back). Or, if the stock rises, roll up and out, or get called out, depending on options prices at the time (close to expiration). Either way, I'll wait until the time value has decayed. My preferred plan is that I get the puts, the stock retreats 2-4 points. I make my money on the puts (selling them at a profit), buy the calls back, and make 2-4 points before waiting for the stock to rise again, and repeat...Let me know what you think...
Ryan |
