I don’t know about you...but my head is spinning.
It was a busy week with a lot of action and putting a few winners on the board.
We’ll talk more about those in a minute, but...
...Today’s jobs number report was UGLY!
We’re staring at an abyss.
It's obvious throwing more money at the issue isn't the solution.
The reaction today could be confusing, after all the S&P 500 hit a new all time high.
But the rally was fueled in anticipation for more stimulus and a possible head fake.
The dollar sold off sharply, while gold and silver saw buyers step in.
Now, The CBOE Volatility Index (VIX), aka the “fear” index, is still above our key 15 levels, trading at 16.69.
What this tells us is that we are in a bull volatile market.
That means the market bias is still higher, but it will likely be choppy and picking our spots will be even more critical.
Now let’s talk shop.
Here’s a recap of what we did this week.
Buy-To-Open the Westrock Co (NYSE: WRK) May 21, 2021, $60 call (WRK210521C00060000)
Sell-To-Close the Westrock Co (NYSE: WRK) May 21, 2021, $60 call (WRK210521C00060000)
Buy-To-Open the Hanesbrands Inc. (NYSE: HBI) May 7, 2021, $22 call (HBI210507C00022000)
Sell-To-Close the Hanesbrands Inc. (NYSE: HBI) May 7, 2021, $22 call (HBI210507C00022000)
Sell-To-Close Petrobras (NYSE: PBR) June 18, 2021, $8 call (PBR210618C00008000)
Right now, we’re holding:
- Schlumberger Limited (NYSE: SLB) June 18, 2021, $40 call (SLB210618C00040000)
- NRG Energy, Inc. (NYSE: NRG) May 21, 2021, $40 call (NRG210521C00040000)
- E2open Parent Holdings, Inc. (NYSE: ETWO) June 18, 2021, $12.50 call (ETWO210618C00012500)
This is my journal which is a debrief of every trade closed or expired to analyze what happened, why it happened and how it can be done better — like what the military uses after missions.
Westrock Co (NYSE: WRK) May 21, 2021, $60 call (WRK210521C00060000)
Date: May 3, 2021
Outcome: exited calls for 10% gain.
Notes: We executed this perfectly. We were looking good at first, but the overall market weakness weighed on shares and we exited before earnings. The rally after the conference call is why they were likely buying calls ahead of earnings.
Hanesbrands Inc. (NYSE: HBI) May 7, 2021, $22 call (HBI210507C00022000)
Date: April 5, 2021
Outcome: Exited same price paid, which was 20 cents.
Notes: Took a shot and executed as planned. I followed this activity because of how odd the buying was. I think this buying was playing for some news that was supposed to be announced, that didn't occur as they anticipated. Shares did continue higher after my exit, but with so little time, I could’ve seen it expire worthless.
Petrobras (NYSE: PBR) June 18, 2021, $8 call (PBR210618C00008000)
Date: April 19, 2021
Outcome: Closed for 20% gain.
Notes: We’ll see if I made the right choice by taking these profits or if it continues higher into earnings. This position did have time, but I’ve had this for a few weeks and it hasn’t done much. With prices back into major resistance, I called the play to take the profit and run.
That’s all for today.
Now it’s time to head to the pool with a fresh jalapeno margarita - TGIF!
I'll have a new trade on Monday and have a great weekend.
To your wealth, freedom, and options!
Joshua M. Belanger