On Mon, Jun 14, 2010 at 10:50 AM, Meuter Gisbert <gismeu@gmail.com > wrote:
Well,
my first step would be in trying to make a forecast of RIG.
And based on that forecast I would act accordingly.
If you see no up move longer term, then remember, cash is a position as well
I agree. Have a plan for specific price events (of the position and of the underlying.)
If it were my position, I'd use tos to determine the price action (based on historical data) over the course of Thursday to the close, Friday open, Friday mid-morning and Friday into the close. I think you'll be quite impressed to see the profit potential from trading out of the position at the right time. It might be easier to simply look at the straddle on a one minute chart from say Wednesday at the open to any given expiration Friday to the close.
As a matter of strategy, I'd discourage rolling a profitable position -- unless the position you're rolling into is actually a desirable new trade to open. Some traders (myself included) tend to get "into" trading, say GOOG and BIDU, and just keep opening new positions, rolling vertically or horizontally, etc. I do this, but I don't think it's smart -- it's seemingly logically impossible that the best trade available to me is always in the same tickers. It's a habit I'm planning on kicking.
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