May 22 weekly OpEx

I have several existing trades with May 22 weekly options as part of the trade. Here is the plan:

$CRM  I own the July 75/82.5/67.5 RRCS. I am long May 22w $67.5 Puts (these will go poof). Options Net: -$1.50 and booked stock gains of $9.45

$WDC  I am long stock at $92 with a 99/98/92 Collar Put Ratio. I will let the long $98 Puts exercise and unwind the stock for +6.00. Final tally: Options Net: $2.12 and a stock gain of $6.00

$Z  I am long stock at $82.96 with a $97 Collar. I will let the long $97 Puts exercise and unwind the stock for +14.04. Final tally: Options Net: -$.78 and a stock gain of $14.04

$XLF  I own the July/May 22w $25 Call Calendar. I will adjust the short Calls to June 05w $25 Calls & take in a bit more premium. Options Net: -$.31

$AXP  I own the 78.5/80/76 RRCS. I will take stock at $78 & adjust the short $80 Calls to a future expiry on 5/22. The short $76 Puts will go poof. Options Net: $.57

$CAT  I am long stock at $85 with a 88/87/84 Collar Put Spread. I will adjust the CPS to a future expiry. Options Net: $.18

$CTRP  I am long the May 29w $65 Straddle & short the May 22w $65 Puts (these should go poof today). I am also short the September $80 Calls. Options Net: -$.64

$HD  I am short the 116/118 CS & $109 Puts. All these pieces should go poof. Options Net final: $2.03 & stock gain: $.93

$NTAP  I am short the 32/31 Strangle & long stock at $31.50. My current plan is to short a Strangle in a future expiry & take in more premium. Options Net: $.73

Positions for clients left to tend to:  $XLV $GILD $V $WFC


– DM 8:35 AM CST


Network Appliance

Here is a Daily chart of $NTAP that shows the gap down move post-Earnings:


Buying the stock on a touch of RSI at 30 has been a mixed bag of results:

  • October, a very nice bounce
  • Jan this year, several false starts
  • And now in May you have a dip to RSI 24.4


Disclosure:  I am short the May 22w 32/31 Strangle. Options Net: $.73

– DM 10:00 AM CST



Review of as it heads into Earnings

I have an existing position in $CRM where I have done a few tweaks today. Here is the trade coming into this morning:

I own the July 75/82.5/67.5 RRCS (Risk Reversal Call Spread)

This morning I added a short stock piece on the break of $73. I have since covered this for a $3.16 gain. I have also added long May 22w $67.5 Puts for a -$.90 debit (protects the short July Puts). The Options Net is now: -$1.50

So in summary, the trade looks like this into Earnings:

  • Long the July 75/82.5 Call Spread
  • Short the July/May 22w $67.5 Put Calendar


– DM 2:30 PM CST



Pricey Stocks

One of the scans I do frequently involves what I term as “pricey” stocks. These companies have a share price that is over $100 a share. This doesn’t mean they are expensive or over-priced. Currently I have 273 tickers that meet that criteria (as well as my Avg Volume criteria):


Courtesy of Finviz

Interesting to see after a day of trading, many show very little movement from the yesterday (5/18) close.

– DM 4:20 PM CST


Quick Sand?

One of the more common trade setups that I look for is a pullback to Support. Here is a Daily chart on $LVS that shows a dip into the Support Box this morning:

Note the mild RSI divergence as price makes a new low versus the March low. It is also worth noting however that the CMF has made a new low versus the March low.

– DM 9:15 AM CST