The U.S. stock market appears to have reversed at resistance and on big volume. The DJIA was struggling to break free of the 12,000 level. The S&P 500 had just hit 1300. The NASDAQ had bounced back toward its January highs. Then the news about Egypt hit and that seemed to be the catalyst to spark some serious profit taking.
We have been expecting the market to reverse in the second half of January so this shouldn't be a surprise. The market correction could be anywhere in the -3% to -10% range. It will be worse for individual stocks. Given this expectation I am suggesting we exit early and either take profits or cut our losses in the following stocks: ESRX, GS, IBM, LCC, MCD, ODFL, and TGT. Our EMC was closed as planned on Jan. 24th.
Disclaimer: At any given time the author may have positions in any or all of any companies mentioned in the Leaps Newsletter.
--Position Summary Table--
Table lists Directional CALL or PUT/LEAPS only.
Insurance puts, if applicable, are not shown.
Red symbol/name represents a play or option position exited or closed this week.