Sold FCX September 55 Naked Puts

This has been a rollercoaster week and that doesn’t even count the big ups and downs of the markets.  I started on Monday with the news that I’d stay employed for at least another month, but at a $15k pay cut.  In the afternoon I found out my dad was in the hospital and had to spend the night there for the first time in his life.  He ended up staying for three nights and left on two different antibiotics and only half of his symptoms diagnosed.  During those three days I found out that I would probably have an offer coming soon from AT&T.  That offer was solidified yesterday around the time my dad made it home from the hospital.  I’ll be making more than two and half times my newly reduced salary (a little less than I made the last time I was there) for a likely two year contract.  I start my new job on 8/31 and my dad is feeling a little better.

When I have a lot going on like this week, I find it relaxing to spend more time looking at stocks and options.  That’s how I ended up making my SSO trade on Wednesday.  Yesterday I came back to FCX and saw a likely pullback coming.  This morning, while FCX was trading around 63.40, my limit order hit and I sold two FCX September 55 naked puts (FCXUK) at $1.50 each and received $288.50 after commissions.  I was targeting what looked like good support around the 10 day moving average and the trend line of higher lows that started in the first half of July.  The next line of support could be at the 20 day moving average, above $60. After that comes previous support/resistance a little closer to $60 and after that support shows around $55 which is an earlier support area and the current range for the 50 day moving average.  I chose the lowest area of support for my strike in case FCX takes a much bigger fall than we’ve seen today.  Worst case, I could see FCX go all the way down to $45, but I hope to be out before then or at least selling covered calls on the shares I’ve been assigned.