The Volatility Trader
105 W. Monument Street
Baltimore, MD 21201
Tuesday, November 28, 2006
Email – #224
Dear Volatility Trader Member,
The next few days could prove very interesting, with a mixture of economic news hitting the market… so it’s important for us to stay on our toes.
Top of the list is tomorrow’s preliminary data on third quarter U.S. GDP growth. Economists are pegging the number to clock in 1.8%. But if there’s an upside surprise above 1.9%, this could trigger a rally, so I’m going to be watching very closely to see if bulls re-surface with any optimism.
However, if the major stock indexes dip below Monday’s low, a near-term reversal will continue, and we’ll trade it accordingly. In the meantime, we’re going to wait a day or two before adding any new positions… just to be on the safe side.
There is one piece of portfolio news to pass along to you, though:
Home Depot (NYSE: HD) has broken below our stop – so it’s time to close the December 2006 $37.50 call option (HD-LU) tomorrow morning.
The rest of our positions are moving along nicely, though. Fuelcell Energy (Nasdaq: FCEL) is trading near our initial stop – so close the December 2006 $5 calls (FQG-LA) if the stock falls beneath $5.97. We’ve given the stock plenty of room to wiggle, and although it has dipped into the red over the last two days, it could easily move higher in the next few sessions. As usual I’ll keep you posted on any new developments.
Exit is everything,
Mark Whistler
