February 11, 2016  Trade Alert -  Black Gold  Portfolio

With the stock below $8 we should focus on collecting short-term premium while we wait for the price of oil to rebound.  Tomorrow we will roll the expiring Feb2-16 8 calls to Feb-16 8 calls and today we will roll down our short Mar-16 10.5 calls to Feb-16 7.5 short calls while also rolling down 7 of our Jan-18 8 calls to the 7 strike:

 

BTC 7 USO Mar-16 10.5 calls (USO160328C10.5)

STO 7 USO Feb-16 7.5 calls (USO160219C7.5) for a credit of $.50  (buying a diagonal)

 

BTO 7 USO Jan-18 7 calls (USO180119C7)

STC 7 USO Jan-18 8 calls (USO180119C8) for a debit of $.43  (buying a vertical)

 

Be prepared to change this price limit by $.05 or more in order to get an execution. 

 
Happy trading.

 

Terry