Taking Profits 8/23/11

After the success of the Libyan rebels in entering Tripoli over the weekend, I felt the market had the right excuse to climb and get out of the oversold levels it was in. I felt uncomfortable sitting on my down put option positions that were all showing profit. I was traveling on business and besides, I don’t look at the numbers during the day as I am a strictly end-of-day trader on my portfolio. The markets and futures were suggesting a gap up for 8/23 and rather than risk missing the sell trade on a limit order, I took the approach of market orders on my puts. I placed market open close orders on 8/22 night for the next morning. I am glad I did as the market went up from there.

Since I just returned home, I thought I would fire off a blog post tonight mentioning closing my down positions.  I am now only in cash, bond and money market funds. Admittedly the technicals all signal down positions on equities but short term stochastics has bottomed out along with the slower stochastics. That is not a high odds winning place for down positions.

I will sit out for a while and look to take down positions again on a further bounce.