Tuesday morning appears to be an ugly day in the making. Dow futures are down over 500 as I write this around 8:15 pm EST on Monday.
Marketwatch has an interesting article worth reading about our current market compared to 1987, around the crash then.
These are the days when one has to wonder if investors are actually finally giving up and taking what money they have left and running away for a while or if this might finally be the sign of capitulation that means the all clear to start investing is near. I’m not going to claim to have a good answer here. I just have to figure out how to play my hand. The best part, if not the only good part, is that I recently closed one of my wife’s old 401Ks to rollover to her IRA and it’s all in cash right now while this gets sorted out. My most recent 401k is in the process of being closed out and moved too. I’m not sure if it’s been liquidated yet, but I sure as Hell hope it was a few days ago. I’m down 10% in the past month in my own IRA that I manage. I need to save what I have left and will wait to move on the rest well after a bottom is confirmed. I won’t try to find the bottom in my IRA.
I’m down about $12,500 from the high I hit just a few weeks ago. I expect tomorrow to increase that loss a good bit, so I’m taking a look on what I need to suck up and take real losses on to stop the bleeding rather than just sit and watch the paper losses grow. I want to be sure I have something left when the bull finds his way back to the markets.
I already planned to sell naked calls on Shutterfly (SFLY) based on a reasonable story from Barron’s. I just lowered my strike since this collapse makes their sob story even better to short.
I’m selling ITM covered calls on CAT and may sell some naked calls to cover my naked puts I’ve sold already too, but the chart shows support. I have to assume that support will break this week and need to be ready for a quick reaction.
ADBE is ugly, but again, I was hoping it would find support at 35 – I might have to take a loss there sooner than planned.
I have four NVDA naked puts deep ITM (in the money) and have been debating if I should sell calls early on it. NVDA can make a run of $5-6 in just a few days back up, so I’ve waited, but maybe I should wait no longer and sell some calls, even if it’s only two, not the full four.
I have extra calls on BA I’ve sold already – happy about that, but maybe I should sell more.
My AA naked puts are ITM, but only by the amount of my premium I sold. If it stopped falling I’d be even, but but but…
DSX has nose dived with falling shipping costs, but could rally like NVDA by a few buck per day. I might have to sit tight on it a little longer too, expecially with the fat dividend they pay.
I sold three VIP Feb 35 puts, I could sell Feb 40 calls (VIQBH) and “win” on both or at least cut my losses to either side. I placed a limit to sell three, we’ll see. VIP could rally some and I’d have my naked put profits, but I think the upside is limited with the short term downward trend it’ll have to break through first. That could make my move double up the profits. Before I cash that imaginary money in, I have to have my limit orders hit to sell the calls.
MOT is fairly easy, I need to sell ITM calls again. I should’ve sold them deeper last time, but at least I went ITM and made some money back. I want to sell the March calls which AMTD doesn’t have posted yet. If they don’t have them up early, I’ll sell the Feb calls.
NYX was assigned to me with this round of options expiration. I have a limit to sell a covered call far OTM in the hopes that it recovers in a couple of months. I might lower that strike to drive home more cash sooner.
If I stop screwing up and getting greedy, $12,500 won’t be hard to make up this year. The first step of not being so anxious is what is killing me. All this said, tomorrow could bottom and start finding it’s way back before the end of the day. I doubt I’ll dump everything at once for that reason.