My target for Orbitz was $13-15 but since Expedia has offered to buy it for $12, we will settle for the 11.55 current price and exit. My advisor said it may be in limbo while details of the buyout are settled. Anyway, that was a 35 % gain on the stock from the $8.50 buy price and better on the 7.5 options bought for $1.3, sold at $4.00
I mentioned oil stocks in the last post and they have been doing a rebound upward as I thought, but took a turn down in the last week. As a group, I am not sure if they have some more back and forth in a 10-15% range for a few more months or if they are ready for the next leg down. However there is one oil stock that looks perfectly poised for a 30% drop. SXL (chart below) has a beautiful 61.8% retrace in classic A-B-C Elliott pattern to the 46 level. It has confirmed a turn down with weekly and daily oscillators. The target is $30-32 in 3-5 months. Shorting is an options play for me so I am going to pick up some April 45 puts at around $2.50. Depending on what path it takes, they will be worth $5 -10 by mid April. Risk management will have me sell half of them for $5 and let the rest ride to $8-10. This is a 90% trade. The stop is if the stock hits 46.5 which would probably cut the option price in half. So risk a 50% loss for about a 200% gain.
The silvers ran into some resistance mid January and have been on a leg down since then, though Hecla is holding up well relative to the field. I have tight stops on my miners which are at a support level but have yet to fully declare whether they are ready for a 3rd wave up or need one more 10% drop. Either way, HL is a long term play and is looking good.
I mentioned oil stocks in the last post and they have been doing a rebound upward as I thought, but took a turn down in the last week. As a group, I am not sure if they have some more back and forth in a 10-15% range for a few more months or if they are ready for the next leg down. However there is one oil stock that looks perfectly poised for a 30% drop. SXL (chart below) has a beautiful 61.8% retrace in classic A-B-C Elliott pattern to the 46 level. It has confirmed a turn down with weekly and daily oscillators. The target is $30-32 in 3-5 months. Shorting is an options play for me so I am going to pick up some April 45 puts at around $2.50. Depending on what path it takes, they will be worth $5 -10 by mid April. Risk management will have me sell half of them for $5 and let the rest ride to $8-10. This is a 90% trade. The stop is if the stock hits 46.5 which would probably cut the option price in half. So risk a 50% loss for about a 200% gain.
The silvers ran into some resistance mid January and have been on a leg down since then, though Hecla is holding up well relative to the field. I have tight stops on my miners which are at a support level but have yet to fully declare whether they are ready for a 3rd wave up or need one more 10% drop. Either way, HL is a long term play and is looking good.
