Trade Alert – Two buys into the panic

It is better to be beautiful than to be good. But… it is better to be good than to be ugly. – Oscar Wilde  

Ugly day post-election. Oh, and there’s panic about the EU debt crisis in the headlines again. Shocker, eh?

The DJIA opened down 100 plus and has faded another 150 since then. Apple’s being a high-beta version of the market, as I’d surmised it would be until we get some clarity on holiday demand for its wares. Amazon too. Google’s trading in its own hemisphere with little correlation to much of anything, as it has been for the last month, although it’s down today along with the broader markets and just about every other stock in the country.

I sent in some more money to my already cash-heavy stock accounts and I’m going to put a tranche of it to work this morning in the panic over Obama and Europe. I’m bidding on some Amazon calls dated out into the first three months of 2013 with strikes starting at $250 and above.

I’m also buying back some Apple calls, rolling them out into longer-dated strikes, as I’d planned when I’d trimmed the calls when the stock was $100 above its current quote. I never thought we’d be buying the calls back with the stock a full Benjamin below where we’d trimmed. I’m sticking with my game plan, as usual though.

I’m looking to sell down some more of my Apple calls from purchases that I’ve outlined for my TradingWithCody.com subscribers when Apple was $150 lower. I’ve sold most of the lower strike priced calls so far which lowers my risk on the downside somewhat, but I’d like to roll some of these calls out into longer dates and higher strike prices so I can have a little bit less capital exposed to Apple.

I’m buying some April or later Apple calls with $700 strikes and above.

I’ll be looking to buy another tranche of our highest-rated positions over the next day or so if stocks fall another couple percent from here.

Don’t forget today’s chat. You can email me your questions to support@tradingwithcody.com if you can’t make the Live Q&A at 2pm EST at https://tradingwithcody.com/chat.