Thursday, July 22, 2010

07/22 Daily Summary

One thing I’m grateful for Today: I did not sell my long Sep 1900 Call Yesterday, it looked tempting to dump it provided we closed with such a bearish candle formation... I opened the computer around 7 AM expecting to be ready to dump my long calls and manage the down-side, what a surprise to see we were already at my up-side adjustment and the contingent order had done its job at 1960. I kept watching and noticed the Vols were not letting off and this was forcing me to be more long deltas than I originally wanted, so I replaced the 1925 call for the 1950 with a vertical spread. This locked in some profits out of the 1925 and moved the position’s delta a bit more in line with what I wanted. Now it is a matter of watching the market Tomorrow and doing a cut and roll on my short 1825 calls. This up-side swing wouldn’t be this hard if the vols were going down with it, but with 3 fast moving days in a roll, the market makers are not letting the vols out of the contracts any time soon.