UPL

[Pascal]

Bought UPL at 20.59.
The stock is weak today and could fall back down to its 50MA tomorrow, but with one long and one short trade on the portfolio, both in the energy sector, I feel that I am in a position that is neutral enough to sail through the FOMC.

However, I will be out if we break the 50MA.


Pascal

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[Pascal]

The UPL trade seems to be moving against me.
Usually, when this occurs fast after a trade is entered, I prefer cutting the position in half, which I just did.

This way, I can either reenter lower, let the position run as it is or get out entirely on the stop.
Psychologically, it make things easier anyway.

By the way, this is what Ernst wrote me about options regarding UPL:

UPL - Options Analyzes

IV is in the low end of the range, no reason to expect current premium is "over" priced. This closes the door for Strangles/Straddles.

Pascal is making a directional long call. So I think the easiest way to play UPL is buying a vertical spread. Buy the Jan 20 calls and sell the Jan 21 calls as a spread for 48ct. Max Profit 52ct. Break even 20.48 - 2ct lower than current mark of UPL.

Max risk 48ct. If you have a level of confidence in this particular trade then you could sell the Jan 20 puts for 60ct to finance the call spread, but then your down side risk is 2000 per one lot.
Personally not my thing in an underlying I know nothing about.

Ernst

[Pascal]

I closed the UPL long at 20.05. The EV pattern is too unreliable for now, while price crossed below both the 200 and the 50MA.

WAG looks OK as a short, but I will avoid it because earnings are coming on Friday.
CERN attracts money. No way to short it here.
SWY might become an interesting long. I will keep an eye on it and will wait to see if further price weakness is bought.


Pascal

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