Loading ...…the $CPCI-”system” goes long again!
Fresh off today’s failure with the SPY Dec’09 107. calls (still in progress), the $CPCI-system is again flagging for a contrarian long. This time, the options of choice will be the Dec’09 105. calls.
The actual ratio value barely budged from yesterday, dropping just 0.01 to finish at 1.82:
It’s interesting to note that the last time there was only a 0.01 difference b/w subsequent days’ readings, we put in the last major bottom (July 9-10th) before ripping higher and into quadruple digits on the $SPX…
While inept, these SPY trades are and have been working as a minor hedge against my overly bearish portfolio. Of course, that has served me well over the last few days as the account is suddenly busting out to fresh monthly highs. In fact, I would’ve had an amazing day if not for the poleaxing that SPW received post-earnings. But I guess that’s the gamble that you take whenever you hold through EPS announcements:
As you can see, I’m down to just a few puts, almost all of which are in the money and are protected via stops at/above breakeven.
In the last week and a half I’ve booked profits on no less than 35 bearish positions (puts + calls on iETFs), so as you can imagine, the well of “overbought” stocks breaking down has pretty much run dry. I only found 3 names today for potential put entries tomorrow, all 3 of which have held up very well during this pullback. Thus, I do not expect these to fill, lest we have an ‘armageddon-cometh’ scenario unfold tomorrow:
- AMZN (@119.41)
- MSFT (@27.87)
- XOM (@73.25)
One final note, re.: $VIX…after today’s action it has entered “overbought” territory and reversal, should the Miracle Meltup of 2009 paradigm hold up, is imminent. Read more about this at the ever excellent Adam’s Options Blog.
Futures are up! Buy the Dip! Don’t worry about that whole doom-n-gloom, Santa’s-a-comin’-to-town…
