Schaeffersresearch.com: bullish, but notes that the indexes are trading near the top of the trading range, with significant resistance overhead.
Chartadvisor.com: no update this week (yet).
My take: The last 2 weeks have been equally surprising as the last 2 months: the markets shop up straight from the trading range bottom to the top. Investors have as if forgotten all about the fear of European debt problems and the double dip recession in US. The end of Sept and early Oct bottom was truly scary that I sold some naked options (more short options than long stocks, in a negatively biased covered call, for lack of a better term). Naturally these net short calls are hurting my return on paper. But unless stocks shoot straight up and never look back again, I use this strategy as an added layer of downside protection.
Ratio of my short/long positions (always short calls and long stocks)
BIDU: 1.37/1, i.e., for every 100 shares of bidu that I am long, I am short 1.37 contracts of Bidu calls (strikes at 110, 115 and 120).
CRM: 1.083/1, with strikes at 110 and 130.
FFIV: 1.32/1, with strikes at 70, 75, 77.5, 80, and 82.5.
LVS: 1.09/1, with strikes at 40, 42, and 45.
MCP: 1.16/1, with strike at 35.
NFLX: 1.5/1, with strike at 110.
PCLN: 1/1, with strike at 450.
SLW: 1/1., with strikes at 30 and 33.
What’s my plan of trading: Most of calls are in the money now, and the market is overall bullish, so weekly options rolling up (i.e., buying the expiring ITM call and selling next weeks call of same strike for a credit) is my overall plan. This strategy gives you the most ROI. Unless the market goes up and never comes back, my negatively biased covered call should continue to generate time values on a regular basis.
