Bought 1 TRN Jul08 35 put for $8.60

This stock has been in a downtrend since May 2007.  It has held mostly between a pair of descending trendlines.  It has now come up and bounced down off the resistance level, with confirmation from the MACD and stochastics.

The stock is currently at $27.06.  Support is around $21.00 and resistance is around $27.85.

My exit orders are:

• Market order to exit if the stock trades above $28.75
• Trailing stop loss if the stock trades below $21.50
• Stop loss on the option at $4.20

 

Bought 1 ADM Jun08 35 call for $8.80

This is the second call I’ve purchased in two days.  I’m not really convinced that the market is done falling, so hopefully these positions won’t get whipsawed if and when the stocks continue falling again.

This stock has been in an uptrend since January 2007, and it formed a trend with an even steeper slope starting in October of 2007.  It has now come down and bounced off of this steeper trendline, with confirmation from the MACD and stochastics.

The stock is currently at $42.70.  Support is around $40.85 and resistance is around $49.60.

My exit orders are:

• Market order to exit if the stock trades below $39.75
• Trailing stop loss if the stock trades above $48.50
• Stop loss on the option at $4.30

Bought 1 RIO Jun08 25 call for $7.80

Note: this trade actually happened on 3/24, but I was travelling so I didn’t get a chance to write about it until today.

This is my first call trade in over two months.  This stock has been in an uptrend pretty much since it IPO’d in 2002, with some minor short-term downtrends along the way.  Most recently, it has been in a solid uptrend since October 2006, moving up within a very well-defined channel.  It has again come down and bounced up off its support level, and there is confirmation from the MACD and stochastics.

The upper boundary of the trend is currently around $46, but the most recent high did not make it to the top of the channel and appears to have formed a double top since it hit almost the exact same point as the previous high.  Therefore, I am treating that as the resistance level.

The stock was around $32.00 when I bought it.  Support is around $30.85 and resistance is around $37.50.

My exit orders are:

• Market order to exit if the stock trades below $29.50
• Trailing stop loss if the stock trades above $36.75
• Stop loss on the option at $4.00

Bought 1 KO May08 57.5 call for $6.10

I bought this call on 1/3, but I was travelling so I didn’t get a chance to write about it on that day.

This stock has been in an uptrend for a few years.  Most recently, it broke up a trendline in October that was previously acting as resistance and has since been using it as support.  It has again come down and bounced up off this trendline.  There is also another overhead resistance level that has been in place since October 2006.

The stock (as of 1/3) was at $61.73.  Support is around $61.10 and resistance is around $65.00.

My exit orders are:

• Market order to exit if the stock trades below $59.50
• Trailing stop loss if the stock trades above $64.00
• Stop loss on the option at $2.00.

Bought 1 AET Apr08 50 call for $8.80

I bought this call on 1/3, but I was travelling so I didn’t get a chance to write about it on that day.

The stock has been in an uptrend since August 2006.  It has a couple of overhead resistance lines, and the stock has recently crossed above the lower one and has now come down and bounced up off of that line.  The MACD and stochastics indicators are also low and turning up.

The stock (as of 1/3) was at $57.21.  Support is around $56.25 and resistance is around $60.65.

My exit orders are:

• Market order to exit if the stock trades below $55.00.
• Trailing stop loss if the stock trades above $60.00.
• Stop loss on the option at $4.00.

Bought 2 CBST Jan08 17.5 calls for $4.70

This stock is in an uptrending channel that’s been in place since last December.  It has come down and bounced off the support line, and MACD and stochastics are both low and turning up.  The stock is currently at $21.65, with channel support at $21.45 and resistance around $27.  However, there is a secondary downtrending resistance level that puts the resistance currently at around $23.45, but it has a sharp downward slope.

My exit trades are set at:

• Market order to exit if the stock trades below $20.85
• Trailing stop loss if the stock trades above $23.00
• Stop loss on the option at $2.00

Bought 1 PEP Jan08 67.5 call for $5.50

This stock has been in upward channel since the beginning of 2005.  In addition, there is a short-term trendline within that channel since August, as well as another line within the channel that used to be resistance and is now acting as support.  The stock has come down and bounced off the point of interesection of these two trendlines within the channel.  The MACD and stochastics indicators also confirm the trade.  The stock is at $71.50.  Support is around $70.25 and resistance is around $75.75.

Exit strategy:

• Market order to sell if the stock trades below $69.50.
• Stop loss on the option at $2.00.
• Trailing stop loss if the stock trades above $75.

Bought 1 SGP May08 25 call for $5.80

The stock has been in an uptrending channel since last June.  It has tried to break out above the channel a couple of times and failed, but it continues to use the lower trendline as support.  It has again come down to support and bounced.  MACD and stochastics are very low, though they haven’t turned up yet so this isn’t really a confirmation.

The stock is currently at $29.46 with support at $28.25 and resistance around $33.  There is also a secondary resistance line from the two failed breakouts that is also at around $33.

I did something different with the expiration on this one.  I normally just go 2-3 months out.  However, the options on this stock had very little time value, and I only had to pay $1.00 more for May contracts than what I would have had to pay for Dec.  I figured I would give this a shot, and see how it affects my returns.  Presumably, if the move happens within the next 1-2 months, I will still have plenty of time value left and will be able to sell for a bigger profit than normal.

This trade is also different because I don’t have a perfect confirmation from the MACD and stochastics indicators, and because the stock fell very quickly from resistance back down to the support line.  I feel OK about that because the support line predicted exactly where the fall would stop, and it has since bounced off of it.  We will just have to see how it turns out.

Exit strategy:

• Market order to sell if the stock trades below $27.30.
• Stop loss on the option at $1.50.
• Trailing stop loss (by $0.15) if the stock trades above $32.50.

Bought 1 SII Jan08 60 call for $9.10

The stock is an uptrending channel that has held up since the beginning of 2007, and the MACD and stochastics are both low and turning up.  It has come down and bounced off support, and is currently at $66.77.  It was actually closer to $66 when I bought the call.  Support is at around $63.25 and resistance is around $78-$80, depending on how long the stock takes to get up that high.

Exit strategy:

• Market order to sell if the stock goes below $62.
• Stop loss order at $4.50 on the option.
• Trailing stop loss (trailing by $0.25) if the stock goes above $77.50.

Bought 1 VSEA Nov07 45 call for $6.20

The stock is an uptrending channel and has come down and bounced off the support line.  The MACD and stochastics indicators are both low and turning up.  The stock is at $48.70 with support at $46.30 and potential resistance at $58.75 and again at $61.50.

My exit strategy:

• If the stock trades below $45, exit with a loss.
• If the option trades below $1.20, exit with a loss.  The maximum loss is $500.
• If the option trades above $58, enter a trailing stop loss.

All of the above are already entered as conditional trades so there is no need to manually enter the closing trades.

Here is the chart.  I am posting this a few days after the fact so I highlighted where I actually bought the call.