I have been watching DRYS and EGLE for sometime. I haven't made any plays on them since last year. But I think that the baltic dry index has bottomed out. It hit a low in the 600's and is now above 3000. I decided to open up a 10 contract call position in DRYS at the $7 strike with March 2010 expiry for $1.35. I am targeting a move up to $15. At this level I will take at least half off of the table and then re-evaluate. I have never really targetted such a large gain, so this is a test.
Stock target: $15
Estimated Profit: $8 per contract or $8,000 +/- time value.
I decided that I needed to put a longer term play on in order to distracting myself from the SMB training program. This way I still fill like I am in the game, but it is not something I will have to actively manage. I caught myself pulling away from the demo this morning in order to tend to my fallen angel (WFC). Right now I need to set SMB as a priority.
ReplyDeleteSmart. Earnings are right around the corner and I'm not too confident that the market will continue to be impressed with anemic less than the worst earnings throughout the entire month.
ReplyDeleteSometimes timing is everything, DRYS seems to be breaking out, but it just might be the pattern we have been seeing over and over again with a lot of stocks this earnings season. They go up and up and up and right before earnings or the day off they crash and burn. I am about $500 in the money and feeling comfortable right now.
ReplyDeleteThe market is continueing to fight its way into positive territory. We will see if the Bulls can win the battle again today.
As we speak DRYS is trying to break $7 and I think if the S&P can turn positive it will be just the catalyst to make this happen.