A Quick Short

Yesterday’s Free Trade, UAL, Moved up nicely yesterday and gaped for a one day return of nearly 30%.  Congrats to those who took advantage of the idea.  Now let’s look to the future for a quick short idea.

MU has made a nice recovery but seems to have run headlong into price resistance.  Take a look at the MU 15 DEC 46 strike Put weekly contacts.  This trade will gives us a nice negative delta position with plenty of open interest.   Theta is the enemy here so if MU does not make a move lower by Wednesday 13th consider closing the position.  If MU closes above resistance you may also want to close the position.

Recently Closed Trades

CSCO 17% • BAC 31% • CREE 48% • WMT 245% • NFLX -40% • STX 42% • 2^nd CSCO Trade 30%

Today’s Market Prep Note

During the evening the Congress passed a continuing resolution that prevents a government shut down. However, their action only extended the battle for 2-weeks. Now the question is will the hoped-for Santa Claus Rally be held, hostage by Congress? Santa held hostage, shame on you Congress! My feeble attempt at humor is simply point out that the market will likely remain sensitive to the spin out of Washington D.C. Of course, the bulls could find their inspiration in the Employment situation number to move higher, but the governmental pressure will be ever-present. Also, weighing on the mind of the market is the upcoming FOMC meeting. As for me, I will continue to focus on price action and continue to trade with the trend. However, I may trade smaller than normal positions due to the uncertainty of the new cycle.

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Doug Campbell is not a licensed financial adviser, nor does he offer trade recommendations or advice to anyone except for the trading desk of Right Way Options Inc.