Well Puts

I sold some TBSI October 7.50 puts this morning. TBSI got back above the 50 DMA on higher volume, but it is still descending so I’m still cautious. DSX and DHT are also doing well today so far and I might buy back my DSX protective put while I still have a small profit. DRYS is pretty quiet.

I didn’t have a lot of options expiring in August. I bought-to-close my JASO puts back on Aug 11th for a nice profit and ZOLT on the 19th at breakeven. I only held DRYS and UNG puts through expiration.

UNG - I choose not to roll my UNG puts into Sep therefore I will be put some UNG at 13 and 14 (2 different accounts). This is the third month I’ve sold UNG puts (June and July expired OTM) so my cost-basis is thankfully much lower than the strike price.

UNG just can’t seem to find a bottom so I need to be very careful acquiring much more. The hourly chart looks terrible. There was a lot of volume on Thursday and that could have been the final shakeout of any weak longs but only time will tell. I will be watching this for a pop next week and possibly sell some Oct 11 or 12 puts.

DRYS - I sold some August 5 strike puts back on 7/9 that exipired OTM. This brings my cost-basis down to $8.73 from a starting point of $14.76. It’s always nice to be able to hold through expiration and collect the entire premium.

All the MA’s are flat so I need to wait and see where the next short-term trend is. If it can break through the 6.25 level it could get going to the upside nicely. If we breakdown and head back towards support at 5.00 I will look to sell more puts again.

I’m watching UNG very closely at the 12.30 level for any signs of a bottoming process. A break of 12.30 and the next support is 12. I’ve established the first leg of my position at 14 and I don’t mind being put more UNG in the 12-14 area. Thankfully I sold some September 14 calls on my current position and lowered my cost basis even more.

I’m still short some August UNG puts and if it breaks through 12 convincingly I will roll them to October 12-13 strike.

I sold SII Sep 25.00 puts today. It broke through resistance at 26.50 and is back above the 50-DMA.

I sold some calls on my UNG and ENER positions yesterday. I have a pretty low cost-basis in both of these but the declining 50-DMA causes me some worry. I’m ready to sell some more puts if either of these turn around. If not, I will take the premium from the calls for now and wait for another opportunity to enter. I’ve always done best in the past to sell calls into fading momentum as soon as I can. I need to get back into that mindset.

TBSI pretty much destroyed the shippers today. Thankfully I bought some puts to protect my DSX longs.

I’m still short the 7.50 TBSI puts and I don’t mind buying it at that price to start my position. If there is more weakness I might roll them to September.

It was a pretty uneventful day for me. No trades. UYG continues to rip and I didn’t sell any calls against my longs even though I wanted to. My other holdings faired pretty well today too.

The market needs some consolidation or sideways action at a minimum. The Q’s are at a 61.8% retracement on a daily chart and SPY is also up against some resistance.

Watching: UNG, FTO, SII, HAL, HOS, MDR, PTEN

Usually when my watch list has a common theme like it does now (oil and gas) it is a good sign. However, I can’t find anything I want to commit to so I’m holding steady with a 75% cash position until I see my setups.

The hardest decision when trading is knowing when to sell a winner. UYG is hardly a winner for me. I’ve held on to this stink bomb for quite a while now and I’ve managed to whittle my cost-basis down quite a bit by selling puts and calls as this thing bounced along what I hope is the bottom.

I’m not ready to close this one out yet but I am anxious to sell some calls on this to get me closer to my break even point. I still think it has some room to go, but there is a lot of supply available in the $5-7 range (see daily).

XLF punched through some resistance and is in a pretty bullish orientation. All the MA’s are lined up nicely – but it is doing this on low volume.

I shorted some RTI September 17.50 puts this morning. RTI found support at rising 50 DMA on higher volume and is above the 200 DMA. Daily chart looks good with some room to move. I sold some CRS puts yesterday so I need to be careful with too much basic materials here.

I bought some 15 strike September puts to protect my DSX position. The puts I sold to enter this position nearly paid for the protective puts. I’m still short some DRYS and TBSI puts which already have a nice profit locked in. I have some orders in to close those out.

Back to DSX. Lot’s of MA crossovers and it is fighting the 50 DMA which is flat to declining. I still like it long-term but you can’t be too careful.