On May 17, 2012, in response to Messieurs Hirsch and Mistal’s assessment that Gold was setting up for a nice long opportunity, we recommended for options traders selling out of the money puts at a level of support where we believed owning SPDR Gold (GLD) or Gold (GC) futures would be favorable. We sold five August GLD 140 puts for $1,195. We now recommend buying those puts back and closing our position. On Wednesday’s close you could have bought them back for $335.00, generating a gain of $860 on the trade. We also sold one August GC 1395 put for $1,190. We now recommend buying those puts back as well and closing the position. On Wednesday’s close you could have bought them back for $180.00, for a gain of $1010.
We are going to let our synthetic short trade on the SPDR S&P 500 (SPY) ride. This trade was set up to capitalize on the potential for the stock market to decline following our Best Six Months Seasonal MACD Sell Signal during the Worst Six Months (May-October). At the low in June this trade was well in the black. The recent rally pared those gains, but as the market has weakened again today so we will update this trade shortly as warranted.
Disclaimer Note: At press time, neither officers of the Hirsch Organization nor Rose Conforti held any positions in GLD, GC, LC, SPY or their options, but may buy and sell at anytime.
Rose Conforti, Chief Strategist at Lotus Capital Group, has been trading stocks, stock options, stock index options, foreign currency exchange contracts and options on futures since 2007. She has a degree in Economics from the College of Mount Saint Vincent and is currently writing a book on options trading.
No comments:
Post a Comment