12/4 Recap

The SPY drift continues as we hit overbought levels now. I would expect a small pullback to the 8 ema at a minimum, but who knows stocks seemingly aren’t allowed to go down anymore and the megacaps are picking up the slack now. This is an amazing move and until we break trend there isn’t much to say here.

I Took A Trade Today

I know you all remember the X trade I posted yesterday and I discussed how odd it was with the 2 week remaining timing. Today we got news their chairman says the deal will close this year, shocker, a day after those calls. Will it, I can’t say but I am up alot this year so for me, I’m going to take a shot at it because well if I’m wrong, the only loser is the government who will get a little less in taxes from me.

I bought 300 of the December 27 $45 calls for just under 2.60, if the trade works I will probably make 2x or more on my money, if not, it goes to zero. I’m up over 60% this year so taking a small shot here won’t kill me. I do not advocate you doing the same unless you accept it likely goes to $0 but have some rationale like I do for taking a swing.

Recent Trades

CRM - On 11/10 I wrote it up as a weekend best idea here at the time I drew up a risk reversal that could have been put on for a $1.10 credit, but with the stock up 9% today after a great er, this trade below has seen the puts collapse almost 70% and the May 440 calls are up over 100% from 3.90 to 8.75 right now. If you’re happy with the gains, take it, but the reason we place trades for a credit is so we can ride them out with no harm as long as we’re right on direction and I do not see CRM below 250 in May at this pace now. There are some trades I flagged in the data below that suggest much higher levels are coming at Salesforce.

Today’s Unusual Options Activity

Here is today’s link to the database, as always it will be open until tomorrow’s open, the rest of today’s action will be added by tonight. There were too many calls added today so please use the link below as the table couldn’t fit.