Monday, March 3, 2008

GE.trade. Was I right or wrong?

In my last post, I said I would go through a whole trade. Well, I was traveling and my internet connect was intermitten but, I did have time to buy GE while I was traveling. So, let's look at the trade so far.

Fig.1

I Bought the GE Jan 10 $30 call leap for 7.00 on the 19th of Feb. with a target price of 38.25 on March 5th. If we look at the chart(Fig.1) am suppose to reach my target on March 5th. Will I? No way! Will it reach the target? Yes, I think eventually it will. The stock is in an up trend and when I look at an earlier Action line I see the the Reaction line formed early. Approximately, 11 days early. Because the first Reaction line was early I expect the next Reaction Line to be late by 11 days. Looking at Fig 2. what I have done is I have made an adjustment in my target day by the eleven day gap and now the target date is the 15th of March.


Fig. 2

I will monitor this GE trade and update the blog as the trade progresses.