Friday, February 5, 2010

The Game plan

Today I am on the hunt to sell call spreads in the following names: ISRG, PCLN, GOOG. All are stocks that have in the last month or so Made new 52 week highs. I am constructing call spreads that basically make the bet that these names will not rally to take out their 52 week highs by Feb '10 expiry.

ISRG --> Looking to sell the 340/350 Feb '10 for $1.35

GOOG --> Looking to sell the 550/560 Feb '10 for $1.50

PCLN --> Looking to sell the 220/230 Feb '10 for $1.75

I have finally been able to make the switch from bull mode to bear mode. I think that most of February will be down. I will start looking for longs sometime in February. I will be looking at the market leading stocks to regain their 50 day moving average as a sign that the market may be turning.

And as we get closer to Feb expiration I may look for put spreads to sell to turn these call spreads into iron Condors. I will update later as to what I actually put on and at what price.

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