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I Couldn’t have Forecasted Any Better

Published on November 2, 2007

I Couldn’t have Forecasted Any Better

November 2, 2007

(for details pls visit www.OptionPundit.net)

I think I couldn’t have forecasted any better. The markets behaved precisely the way I captured in my pre and post Fed announcement posts (Scenario-1). Thank your OP readers for your e-mails.

First of all, it turned out to be a prudent move to close most of my portfolio well before the Fed announcement. Nov’07 portfolio is up over +15% (only 2 mini-portfolios are still opened). There are 3 more weeks for Nov’07 expiration so I can re-invest these freed funds either for Nov or can soon start December portfolio. FYI, here is the snapshot of what I have closed for this month-

  1. MON, +45.9%
  2. BHP, +30.5%
  3. DE, +17.2%
  4. BG, +5.7%

On the speculative side, XLI, XLB dropped sharply well before I could even close those. But thanks to GDX Vegas and FXI straight puts. These helped cushion any meaningful loss on remaining open positions.

crox-nov-2-2007.pngThank you CROX! Though I loved your rise to top, I am loving the fall even more. Here is the closure of one trade for +68.8% (Nov 45puts) in less than 15minutes. Nov 40 puts are trading in positive territory as well but I am still keeping that for a little while as those are now almost free (due to profits on Nov 45 puts). I originally wanted to send this via E-Alerts but it moved very very quickly (will get out around 49 on upside and 43.8-42.5 on downside).

dow-trans-nov-2-2007.pngI am restating what I mentioned in my earlier post, watch out for around 12,800 for Dow and about4,660 for Dow Transport. If both are breaking below this, I am fully out of the way of bears with due respect to their move.

Have fun with volatility, profitable trading, OP

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