Feb 5 #Fuzzy Land
I’m a bit shell shocked after these last 2 days. As I watched my January profits approaching a 50% retracement, it was time to liquidate almost everything to protect that level. By end of the day today my Jan profits have retraced 61.8%. An appropriate number for fib aficionados! Fuzzy bear trades brought salve in the way of $7243.00 today. Only a couple Fuzzies remain: MU (x3), MSFT. Added a new long fuzzy on IWM and TLT, and a fuzzy bear on FXE.
I’ve got a family member, C-level exec in a public company, called me 2 weeks ago, wanted me to design a trade for him to protect his employee stock options that he couldn’t sell until April 1. He was not ethically allowed to short his own company. “No Problem” I said, got the perfect trade for you! A 5-lot SPX unhedged fuzzy bear would give him $150K profit in a 10% correction, the trade was really cheap; about $24.00 (Mar29 2800/2800/2805). Tonight the trade costs $211.00. That’s $93,500 profit. Did he do the trade? No (but I didn’t either). Guess who called during the game last night in a bit of a panic. Yep.
Closed Fuzzies for the quarter profits were slashed to $26,584. But I know a LOT of people have lost everything they made in Jan, so I’m grateful that I’m still green for the year. Other than small fuzzy bears for quick flips, I’m really trying to wait for the Face-Ripping rally to set substantial bear trades.