No bounce in the stock markets after such a big sell-off is not the best sign, but at least the market isn’t any lower. After such a steep sell-off yesterday though you would have expected a bounce even though my market direction indicators last night did not point to a bounce. The market timing technical indicators should be interesting to view after the close. Meanwhile there are some stocks to mention in my Intraday comments.
Stock and Option T Stock (AT&T)
Earnings came out and were quite good, beating analysts’ expectations but T Stock sold off to $33 first thing on big volume and at noon another big trade down to $33.53.
I sold 5 naked puts for Nov17 2012 at $33 at .46 cents and I will consider closing them early. I called my discount broker who looked into T Stock and advised me “someone big wanted out”. Even when Warren Buffett wants out he takes his time.
Stock and Option Intel Stock
Yesterday I sold puts for Nov at the 21 strike. I did 20 naked puts at .44 cents. I closed them this morning for .30 cents. I am hoping for another move lower and then sell the $21 put again. My goal is to keep building up the income in the Intel Stock trade and I will continue to reduce and roll my in the money naked puts. The advantage of reducing rather than simply rolling lower is to release capital for trades like this one. In the end my average cost basis when I am finally assigned shares, will be a lot lower than where my naked puts are currently. I posted the announcement of this trade this morning.
Stock and Option Scotia Bank Stock
Bank Of Nova Scotia is among my favorite Canadian Banks. I have waited for the stock to pullback to $50.00 and waited to sell naked puts since August which was the last time I sold naked puts on this bank. The $52 put strike is reasonable for Put Selling but if stocks pull back harder, this stock will definitely fall with the market and certainly could make the $50 strike excellent again. Got my eye on Scotia Bank Stock!
Stock and Option McDonalds Stock
I have rolled down my McDonalds Stock this morning as per my McDonalds Stock Strategy article in the members section. I added a put to the roll down. This should be interesting to follow. The weakness in McDonalds Stock is to be expected and the Technicals should the stock is remaining under pressure so it could move lower. When it does I will continue to apply the same strategy. I have used this strategy for years on big cap stocks and it has worked almost every time. It is more capital-intensive so you need capital to make the strategy work, but it certainly can create large profits.
Stock and Option Royal Bank Of Canada Stock
Royal Bank Stock represents Canada’s biggest bank. Yesterday Royal Bank Stock pulled back because of an acquisition. I received over a hundred emails asking me if it was time to buy. Honestly, the bank is over-valued. I know about the Price to Earnings, the Dividend, I know all those things. Technically though if you really want this bank sell puts at $54 or $52. That would be a nice entry-level. There is limited support for Royal Bank Stock at today’s valuations. I would be waiting for lower prices.
Stock and Option SPY PUT Trade
I received a number of emails wondering about the SPY PUT trade for today. Remember my article on not betting against the stock market trend? Here’s a link again. Today is not the day for the SPY PUT trades. Yesterday was a down day. The Spy Put trades need to be used on their appropriate day. Today is a sideways days which is why investors trying to trade today are having so much trouble. I’m not trading the SPY PUT today.
Stock and Option Intraday Comments Summary for Oct 24 2012
That’s all the stock and option news at present. I hope I have answered a few questions. I am working on a Facebook Stock Put Selling strategy this morning and as explained I have not done the SPY PUT trades at all today.