For the current month the underlying expired on high volume near some price say 40.
So the underlying has shown some strength recently and the first thing you would be to get the volatility envelope from your volatility package for the last 60 days.
Underlying at 40.27 and if you sell a 41 call on the underlying and see that right now it is trading for 77cents. That means you would get a 4% return in 30 days if called.
Also note that earnings of the underlying are 2 days after the month's expiry so the price will continue to move up towards the earning date.
The three goddesses have revealed the following numbers for this month's expiry.
39 41
38 42
37 43
March 25th 2010,
It is just 2 days after the above post and here we see a jump in the underlying towards the three SD price level. So should we sell a call now as the volatility is very high indeed....
41 calls have now climbed from .77 to 2.90
44 calls @95
and 45 calls @56
Whoa.......
Let us see what happens.....
Mar 30th 2010
Underlying is pulling back from the breakout towards 42.00 expect it to stay there for 2-3 days and then move higher as we head into earnings.....but since the broad market is topping out we dont know for sure
41 calls at 1.61
44 calls at .25
45 calls at .12
BroadMarket showing weakness at 117 being the resistance and 115 a support
