Javascript DHTML Drop Down Menu Powered by Drop Down Menu
FullyInformed.com - Options and Stock Strategies For Income

SignUp For Updates 

  You are here:


Bookmark and Share

 

 

Join The
Options
Forum
 
I set up a Yahoo forum for those interested in discussing selling stock options for income including covered calls, selling naked puts, spreads and other option and stock strategies. JOIN HERE
 

 

 
Put Selling
Why Sell Puts
Example Trade- Selling Puts
Tools For Picking Naked Put Strikes
Selling Puts Is Superior To Covered Calls
Understanding The Naked Put
4 Basic Rules For Selling Puts
Selling Puts For Profit & Avoid Assignment
Caterpillar Naked Puts
Put Ladder On Barrick Gold Corp
Rolling Put Options Strategy
Covered Calls
Earn 3% With In The Money Covered Calls
Rolling Covered Calls Down
Staying Positive
Other Strategies
Moving Averages On Cisco Stock
Writing Uncovered Calls
Long Straddle
Miscellaneous
Importance Of A Plan, Goal & Objective
Early Warning Tools
Understanding The VIX Index
The Cautious Bull
Averaging Down In Stocks
"Squeaker" Option Trade On JNJ
Dividend Stocks That Cut Dividends
Hedging Downturns With SPY Puts
Defensive Stock Investing
Moving Averages Trading Strategy
My Strategy Explained
Rescue Strategies for Bank Of America
 

 

 
Trade Anatomy
Charities Are An Industry
Fed Understatement - Defying Logic
A Personal Comment On RIM
Exxon - Patience Is A Strategy
VISA - Risk Against Reward
Microsoft- Reverse Put Ladder
Research In Motion - Not For Investing
Thank You Ben Bernanke
Greek Debt Crisis
Dividend Stocks That Cut Dividends
The Cautious Bull Strategy
Defensive Stock Investing

Spreads VS Selling Puts

Thank You Tax Man
What Next For Research In Motion Stock

Latest Microsoft Stock Report

April Options Results
Comparing The Bear Markets Of 2000 to 2003 and 2007 to 2009
Microsoft Puts Are Better Than Gold
Dance Near The Exit
How I Treat My Investing Like A Business
Microsoft - The Ultimate Utility Stock
The Value Of A Plan
Staying In The Game
It's All About Oil
Market Trend: Still Up - But Watch For June

 

July 2 2011 - STOCK - CISCO - CISCO SYMBOL - CSCO

Moving Average Trading Strategy For CISCO

Using The 10-20-30 Moving Averages Rule For Trading Cisco

 
 

Part 2 - Year 2008 Cisco Trades Using Moving Averages Strategy

Introduction:

Trading article by J. Fergus

As explained, I learned a few things about using this 10-20-30 moving averages strategy. The most important being to watch for the profit and take it if I think the stock is going to turn down or the 10 day simple moving average gives me an indication that it may be stalling out or turning down.

On top of this, by the winter of 2007, it appeared pretty obvious to most investors that the stock market was pulling back from the recent highs of the year. There were rumblings of trouble ahead, but no one knew just how bad the bear market would get.

These are my trades for 2008. I again want to acknowledge all the work Teddi has done. Doing all the charts for this trade and putting together the tables to show the trades took a lot of time. Thanks Teddi!.

Date Comments & Action (all figures include commission charges) Debit/Credit Balance

Cisco Stock Chart - Jan 1 2008

Jan 8 2008 Sold 10 Uncovered Call Contracts Feb $26.00 for $0.91 each.
This is one of my favorite strategies, selling uncovered calls. If you missed my comments about selling uncovered calls you can read them in Part 1. Since November the stock had not recovered. Around mid-December 2007 the 10 day simple moving average almost crossed the 20 day exponential average, but then it fell back. This was my cue to sell uncovered calls.
These uncovered calls expired in February, unassigned.
895.05 895.05

Cisco Stock Chart - March 24 2008

Mar 24 2008 Bought 1000 shares at $25.20
In hindsight this was a mistake, but the 10 day simple moving average (SMA) had crossed the 20 and 30 day exponential moving averages (EMA). It had done this a couple of sessions earlier and today the stock moved higher than yesterday. I took this to mean that the stock was moving higher and bought shares.
(25204.95  

Cisco Stock Chart - April 16 2008

Apr 16 2008 Sold 1000 shares at 23.55
The 10 day crossed the 20 and 30 day EMA a couple of sessions earlier. The stock fell quickly and today it jumped up. I could wait, but I take the signals seriously and I sold my shares for a loss.
23545.05 (1659.90)

Cisco Stock Chart - April 30 2008

Apr 30 2008 Bought 1000 shares at $25.60
The 10 day simple moving average crossed the 20 and 30 day EMA two sessions earlier. I was somewhat concerned as the stock pulled back a bit today as it has the last two sessions. However as I follow the moving averages strategy consistently, I bought my shares today
(25604.95)  

Cisco Stock Chart - June 6 2008

Jun 6 2008 Sold 1000 shares at $27.00
The last few sessions the stock was meandering sideways. The 10 day just a few sessions ago was looking like it was going to pull back. I decided to stay with what I had learned from last year, and I sold my stock to lock in my profit.
26995.05 1390.10

Cisco Stock Chart - June 23 2008

Jun 23 2008 Sold 10 Uncovered Call Contracts Jul $24.00 for $1.27 each.
With the 10 day SMA falling through the 20 and 30 day EMA, I sold uncovered calls. The mood of the market is poor and technology in general is falling. If the stock moves back up I will buy stock and turn these into covered calls. 
These uncovered calls expired in July, unassigned.
1255.05 1255.05

Cisco Stock Chart - August 13 2008

Aug 13 2008 Bought 1000 shares at $24.20
I really should have sold uncovered calls shortly after the stock pulled back after I sold my shares on June 6 2008. But again, hindsight is great isn't it. Today the 10 day simple moving average crossed the 20 day exponential moving average and 30 day exponential moving average. I bought shares.
(24204.95)  

Cisco Stock Chart - August 28 2008

Aug 28 2008 Sold 1000 shares at $24.67
The stock moved up after I bought it on August 13 and then it meandered with a slight biased to the downside. The 10 day simple moving average kept falling so I decided to close early and lock in my profit. I felt pretty good about making sure to close when I felt that the 10 day simple moving average looked to me like it could be turning. In the chart above you can see how the 10 day was turning back down. While the trend could change and move back higher, I felt it prudent to close.
24665.05 460.10

Cisco Stock Chart - Oct 13 2008

Oct 13 2008 Sold 10 Uncovered Calls Nov $19.00 at $1.35
There is now nothing but bad news in the stock market as it falls almost every day since Lehman Brothers went under. There is no doubt in my mind that the stock is going to fall lower along with the entire market. This is my chance to sell uncovered calls. Today volatility was enormous and the stock ranged from 17.80 to 19.30 and closed on the high. I sold the Nov 19.00 strike. If I was wrong I would buy stock and turn it into a covered call. I was pretty sure the stock would fall a lot further. I could have considered buying puts, but that is not a strategy I am good at. The volatility made for terrific premiums.
These uncovered calls expired in November.
This concluded my Cisco Trades for 2008
1335.05 1335.05
  TOTAL INCOME TO NOV 2007 - $3675.05
Largest Amount Invested - $25604.95
Return on capital - 14.35%
   
Summary To End Of 2008

Closing early when I determined that it was better to lock my profit in, worked very well this year. What i really enjoy about my trading and using the moving averages strategy is that my money is not in the market all the time. Therefore when the market collapsed, I was able to sell uncovered calls and keep my capital out of the market as it collapsed. This was all due to following the moving average strategy. The 10 - 20 - 30 moving averages strategy showed in September that I should not commit any capital to the market. The averages showed that the stock was falling every day. How simple is that! The moving averages kept me out of the market during the worst of the crash. For such a simple strategy, it has excellent fringe benefits. 

Continue To Part 3 - Cisco Trades For 2009
Return To Part 1 - Cisco Trades For 2006-2007

Related:

Read the strategy paper on the 10-20-30 Moving Averages Strategy
Review the Research In Motion Trades Done Using The Moving Averages Strategy

 
 

Disclaimer: There are considerable risks involved in all investment strategies. Trade at your own risk.
Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed or presented are financial advice, trading advice or recommendations. Fullyinformed.com is a private website. Everything presented and discussed are the author's ideas and opinions only.
By using this site, you agree to be bound by its terms of use. The full terms of use can be read here. If you do not agree to the terms of use, do not use this site. The author of fullyinformed.com assumes no liability for topics and ideas discussed, errors and omissions, ads and their content and external links. Any corporate insignia used are registered trademarks of their respective company or corporation and are being used for identification purposes only. All material copyrighted by FullyInformed.com. Reproduction in whole or in part prohibited. Copyright © 2008

 |  site map  |  privacy policy  |  contact me  |  subscribe  |  exchange links  |  the author of fullyinformed  |