June Option Investing – EDC Covered Calls

My $36 calls expired, leaving me with all my April shares.

Option premiums are back on the high end this month, so I’m expecting some volatility.

I’m guessing that EDC will rebound from support levels ($32-$33), but I’m not sure how long it will take to test the downtrend…glad I get paid a premium regardless!

I couldn’t get anyone to bite on my limit orders yesterday, but today I got some action – $33.93 calls at $2.45.


June Option Investing – DRN Covered Calls

My June $74 and $72 calls all expired, so I am left with the same position size as last month. As I’ve said before, the general markets in a correction dictates selling calls slightly below the strike price.

Option premiums on DRN are back up this month. I set my limit orders at the beginning of the day (Monday), and ended up selling $70 calls at $4.60.

June Technical Analysis – DRN and EDC

Friday was expiration day, so it is time to check the tape again. All of my DRN and EDC options expired over the weekend. One the positive side, commissions will be lower this month!

With the general markets in a downtrend (according to IBD), my orders will be placed below the strike price in June, as a precaution.


May’s assessment of DRN:

DRN consolidated for a majority of the May timeframe, within the $70-$80 price range. The uptrend since last October is also intact..

After a brief test of the 52 week high’s, DRN fell back to earth and is now testing the uptrend from last October. On the plus side, DRN found some support at the $63.00 level.


Here’s what I said in May:

EDC was able to reclaim the 20 DMA for a short period of time, then failed to find support there or at the 50 DMA. It appears as though there is some support at the $33 level, which pushed EDC back above the 200 DMA..

EDC is now approaching lows for the year, after continuing lower and breaking through its 200 day moving average. EDC still hasn’t broken the $32/$33 support levels, but most moves lower have been on above average volume, which is not a good sign. The downtrend is currently at ~10% per month, so by the end of June/beginning of July, we could see a retest of the downtrend at $36/share or so.

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