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Strategies & Market Trends : Zeev's Turnips - No Politics

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To: Jdaasoc who wrote (84904)6/25/2002 12:18:02 PM
From: Steve Huskey   of 99277
 
I trade some options. I have some advice.

It sounds like you have more than one position which is good. Given that this move is huge on a daily basis.. it's time to take some profits. You can scale out of your position. Take some profits now and set another target lower for the rest. If it goes against you or goes flat.. you have money in the bank and can exit the rest.

If it continues down... You have money in the bank too, so it's a no lose scenario. Dont get too greedy. Based on the size of the move, the premiums should skyrocket, so you will get even more money in the short term now. If it goes flat, which is likely to happen soon, this premium increase will dry up, which is another reason to look at banking some now.

I like to wait and bid for the opening the next day after a big move like this, provided it holds till close. The premiums really seem to jump more the next day at open as everyone has had a chance to see the charts overnight. Also, there is often an opening gap in my favor.

When bidding out, I usually set a target slightly above where the price is at close (above being in my favor). I let the market come to me. I have found this is the the best way to maximize profits whether trading options or not. Bid into strength and let the market come to you.

Hope that helps.

Steve
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