Well Puts

Earlier this morning I closed out the DRYS January 6 puts I wrote back on December 2nd. I also sold covered calls as part of that trade. I’m keeping the calls open and closing the put side of that strangle.

I was able to close these puts out at break-even so I decided against rolling them to February. DRYS is back below the 50 and 100 day SMA. If I want any more exposure to shippers I will probably look to sell DSX puts instead.

DRYS Daily

Sell to open IPI February 27 puts. I wanted to make this trade last week but I missed it. I decided to give it another try today after it found support at ~28.80 which is also a rising 50 day SMA. $27 coincides with a rising 100 day SMA as well. MOS and POT have similar charts.

IPI Daily

IPI Weekly

I’m having a bit of a tough time finding anything suitable to fill my February inventory. The silver miners are looking pretty good – notably PAAS, SLW, SSRI, SVM, MVG, HL. The silver miners would have been timed better if the puts were written last week, but it was a busy week for me and I missed it. I still think the trade could be done on a few of these. I like PAAS and I’ve done well with that one in the past.

I’m also watching apparel stores like ANF and CHS. I sold some puts on AEO about a week ago and that trade has been working out. Some other miscellaneous stocks include CIG and HEAT. The chart for CIG is almost perfect but the 17.50 strike is too close to the money. HEAT might be a good trade later this week or next week.

No trades today. I’m feeling rushed today and I feel like I need to write some puts – not the right mindset to be in when I’m logged into my brokerage account.

Sell to open Energy Conversion Devices, Inc. (ENER) February 12 calls. The December calls I wrote expired OTM and I decided to turn around and sell February calls right away. I’ve been successful selling calls on ENER in Sep, Oct, and Nov and managed to get my cost basis down to $11.74. I’m short the Jan 11 puts as well.

ENER is stuck in an ugly wedge and I normally wouldn’t be wasting my time with this stock – as a new trade that is. However, I got myself into it months ago and I’ve been able to repair it quite well. No reason to be long a stock with a declining 50 and 100 day MA.

ENER Hourly

Sell to open China Green Agriculture, Inc. (CGA) February 12.50 Puts. CGA pulled back to support at about $14.70, which was also support at a rising 50 day SMA. I tried the 15 strike but my order didn’t fill. I’m much more comfortable with the 12.50 strike.

CGA Daily

I had the following options expire in December.

Century Aluminum Co. (CENX). The December 7.5 puts I wrote back on November 12th expired OTM for a 5 week return of 2.67%. * I’m also short the Jan 7.50 puts. CENX exploded back on December 10th and I’m glad I could participate in part of that move. If we get some consolidation or a pullback in the next couple weeks I may look to sell the Feb 12.50 or 10 puts.

CENX Hourly

Diana Shipping Inc. (DSX) – I had both the December 12.50 puts and December 17.50 calls expiring OTM. I wrote the puts back on October 29th for a 7 week return of 4.74%. * I wrote the calls on November 19th for a 4 week return of 3.10%. * This knocks my cost-basis down to $11.09. I’m currently short the January 15 puts.

DSX Hourly

Energy Conversion Devices, Inc. (ENER) – I wrote December 14 calls back on November 6th. This is a 6 week return of 2.45%. * ENER is showing some signs of improvement. I’m short the January 11 puts.

ENER Hourly

Ultra Financials ProShares (UYG) - The December 6 calls I wrote back on November 13th expired OTM for a 6 week return of 3.49%. *

UYG Hourly

* The return is calculated using the premium I received from the sale of the options (less commissions) and the capital required to pay for their possible assignment.

Sell to open HBI January 22.50 puts. HBI is up today on higher volume. Price pulled back to the rising 50 day SMA. The 22.50 strike gives me a little room as well. 22.50 is also trendline support as seen on the daily chart.

HBI Daily

I wrote DryShips, Inc. (DRYS) Jan 6.00 puts and Jan 7.50 covered calls earlier today. DRYS has been forming a symmetrical triangle for the last few months and all the moving averages have flattened out as seen on the daily chart.

I’ve been able to sell a lot of puts over the last several months on DRYS, but I need to watch this set of options very closely for a breakout as it is nearing the apex of the triangle. I don’t really follow chart patterns in a strict sense – I’m just aware of them. Trend lines and moving averages hold much more importance with my system.

DRYS Hourly

DRYS Daily

STO DSX (Diana Shipping Inc.) Jan 15 puts. I mentioned a week or so ago that I would be ready to sell the January 15 puts on a pullback. I’m still short the December 12.50 puts and the December 17.50 calls. On continued strength I will probably close the December calls.

I was tempted to sell some DRYS puts as well but I need to see a little more follow through in the shippers before I make that commitment.

DSX Hourly

STO UAUA (UAL Corporation) January $7.50 puts. UAUA jumped back above the 50 day SMA on trendline support. I had an order in this morning at the 6 strike but it didn’t get filled. I sold the 7.50 strike which leaves me the 6 strike in case I need to make any trade adjustments.

All the major airlines are up today. I’ve had several of the airlines in my watchlist and finally went with UAL. I may add some DAL or CAL on a pullback.

UAUA Daily

UAUA Weekly