Options Trader: Thursday Wrapup

by: Philip Davis

That was another great day!

Unfortunately tomorrow is options expiration so anything that happens is meaningless but we held our levels great today as the market resisted all attempts at a sell-off. With the oil and mineral sectors down close to 2 points, holding levels is all we could ask for.

Gold took a real plunge around lunch and finished the day way down at $625 and copper showed signs of worry dropping half a point.

Oil barely stayed above $70 and finished at $70.06 but you would think it was $76 the way the oil sector rallied in the afternoon.

This was another one of those days when stops were king as many doubles turned into small gains over the course of the day.

I tried to sell my late day picks AXP and YHOO but they just kept going up and I couldn't pull the trigger. I also couldn't pull the trigger on an ill-fated XOM put that reminded me why I should just stay out of that stock.


DT had a nice day but VOD opened low and stayed there. No real movement on our new leaps.

Dell performed as expected with a in-line earnings but they gave us a spectacular .20 entry on the $22.50 puts that will hopefully work tomorrow.

AMD gave us a nice open on a 7% gain and the Jan $27.50s were the right play at $2.05 (up 60%).

BTU came in nicely a couple of times and my entry on the Sept $52.50s was just .75, a nice hedge against my oil puts.

ACI Oct $40s came down to $1.45 so we will see how these play out.

CAT never gave us an entry.

HD finally got it in gear and the Sept $35s are up .10 at .80. The November $35s are also up .10 at $1.80.

Boy did we get a big SHLD sell-off! No reason to play the current calls with that drop but the Sept $150s for $2.30 are an amazing deal. This is why we wait to see reactions to earnings, also why we always sell into the initial overreaction.

SUN was the right call today with Sept $75 puts running up to $2.55 (up 35%) and the Sept $70 puts hitting $1.05 (up 95%). The correct move was to sell the $75s and ride the $70s out for free.

SU got off to a nice start and the Sept $75 puts look good at $1.55 (up 40%).

BJS Sept $35 puts hit $1.45 (up 40%).

We should have played HAL and SLB - or any oil for that matter, they pretty much all worked!

CVX did not work, going up all day. I waited and picked up the Sept $65 puts for $1.15 and already lost a dime.

RDS.A barely budged and the Sept $70 puts held around $1.30.