Take BX Profits

Lock in 20% Gainer

By Bryan Bottarelli
Thursday, September 04, 2008 9:54 AM EDT
Thu, 4 Sep 2008 13:54:00 GMT

PLAY: Sell your BX September 20 Puts (BX UD) at or above $3.10, good for the day.

Dear Bottarelli Research Member,

We’re opening the day with another loss, and I’d like to use this opening session drop to lock in gains on our Blackstone (BX – NYSE) put position. The BX September 20 Puts (BX UD) that we entered on September 2nd for $2.55 have now crossed the tape at $3.00, good for a modest 18% gainer. As I write, the bid/ask spread is $3.10 to $3.30, so floor traders are beginning to tick them up. I think we can take 20% gains on this play.

From a chart perspective, shares of BX are now inching below their 50-day moving average, which could lead to even more selling pressure in the days to come. But in this market environment, a bird in the hand is worth two in the bush, so let’s go ahead and lock in these profits now!

BX

PLAY: Sell your BX September 20 Puts (BX UD) at or above $3.10, good for the day.

At the same time, continue to hold your SDS September 66 Calls (SDS IN). We entered these ultra-short calls yesterday for $2.80, and after an extremely “up and down” session, they’ve now traded as high as $3.00 in today’s action. We’re basically right at our entry point on this ultra-short play, but I suspect that we’ll see profits coming soon. Hold for more gains.

SDS

And just to follow up on our GENZ September 80 Calls (GAA IP), as much as I’d like to hold this position, it officially hit our pre-determined stop price on two occasions yesterday. The trading was very choppy, and I still expect GENZ to rise, but for the purposes of our model portfolio, this position is now closed.

I’ll be out later in the day with more alerts. But until then…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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