Sold CHK Covered Calls

I mentioned my plans for Chesapeake Energy Corp (CHK) in my post yesterday and today I acted on it.  While CHK was trading at $45.16 I sold two CHK September 50 covered calls (CHKIJ) and received $318.50 after commissions.

I saw CHK was up again this morning, but hit resistance at the 10 day moving average.  On the other hand, it broke the trend line of lower highs and the low of today hit that line and used it as support.  That showed a bullish picture to me, but I decided the 10 day moving average could be more important and decided not to wait any longer to see how it played out.  As CHK moved closer to break even for the day I entered my limit order between the bid/ask and it hit three minutes later.  It’s now three hours since my order hit and CHK is up to $47.39 so far.  That’s $2.23 higher than where it was when my order hit. 

I still have $500 in potential profit from the stock’s gain up to the strike and also have the $318.50 in extrensic value of the option’s premium to disolve.  If all goes well, I’ll have $800 more in a month than I do now and that’s not counting the $280 in premiums I have left to disolve from the September $42.50 naked puts I sold earlier.