Herm, I'd be suspicious of that little flag that formed 5/13-5/15. Sure the RSI is sky-high, and it's over-bought on the stochastic. But look back at the chart, and the RSI isn't as high as it has been on some previous peaks, and it's had some double-peaks as well, where the stock price shot up higher on the second peak.
On the other hand, it sure has gotten away from the 50ma, and has never fared well in the short-term when that has happened.
Still, I think it's possible HWP may not pull back further than the top of that flag. So, maybe 88-90.
If you wanted to take profits at that level, would you play a different put?
I'm curious about your reason for using a LEAP. It's conservative, in that it's got lots of time premium. But wouldn't you expect volatility to drain-off post-earnings now? I'd think you'd want to avoid using high time-premium options in that case?
(You ARE talking about BUYING a put, right?)
I am considering buying some June puts, for a very quick move. I would bail out of the puts at 88-90. It seems low-risk to assume a move to that level. I certainly don't expect it to shoot to 100+ right here. Worst case would be it forms a flag here before a further move up, in which case I should be able to recognize the flag forming, and still be able to make a small profit selling the puts with the stock in the low 90's.
Sorry to get off-topic with a non-CC play (but YOU started it! :) ) but so far I've done mainly straight call and put buys. At this point, I'm continuing to do that, but watching carefully what you guys are up to. :)
I'd really intended to stay out of the market until after Friday's expiration. I closed DELL and SUNW call positions last week for a very nice profit. (85% on the SUNWs) and decided at that point to wait until after expirations. But I was considering only long/call plays.
BTW, still waiting to make some kind of move into BYND with the intention to CC ultimately. It seems to be at a critical juncture, though, with the possibility of a significant drop, so I am still just waiting it out. |
