... and the game goes on.BIL's intraday price action yesterday...

... and the game goes on.

BIL's intraday price action yesterday was bullish - thus the exit from my put option position at a tidy profit.

Today's price action has reaffirmed that feeling. Simply said, BIL has been oversold in the short term.

Now, please don't take my words as gospel, 'cause i'm not infallible! Guessing short term price movements in an inexact science, and no one has a 100% track record.


My strategy from here is to wait for another entry signal to short the stock. I've got a 'gut target' of $6.50... this means that i'm not willing (under current circumstances) to enter short again until BIL is over the $6.50 level.

Why?


Reasons:

1/ With every fall, BIL is getting closer & closer to fair value. This means that with every fall, the risks for the shorter increase, and the potential returns diminish.

2/ There are many fish in the sea. The 'margin of safety' principle applies just as effectively to short term option plays, as it does to long term investing. Don't go chasing the same fish from the north pole to the south pole, when there may be many better opportunities on the journey.

3/ Patience is a virtue.