When CAR broke above $600 on Monday, I bought the May $150P on a whim. It cost me $180/put. There was no technical reason to buy them, just my belief that CAR was vastly over-extended. Three days later those puts traded as high as $750 each, as CAR tumbled over six hundred dollars. CAR I chose not to send this trade out to PRO subscribers, thought it was too risky as I had no pattern recognition set-up to justify shorting the stock. "Vastly over-extended," the Semiconductor ETF is starting to resemble CAR near it's height. It may take a few more bars higher for SMH to top, but like CAR, when it does, the decline will be just as spectacular. SMH Up close to 50% in the past three weeks! SOXS SOXS is the 3X inverse of SMH I'm starting to accumulate June $20 calls on SOXS, allowing plenty of time for a top to be put in. Unlike the CAR short, I am sharing this one with subscribers. I can't guarantee the same outcome as with CAR, but my reasoning is identical: It's just too damn high. Your choice, follow me in, or watch from the safety of the sidelines. Caveat: Don't go all in with the first entry, we may be dollar cost averaging for a few days...or weeks. SOXS Jun Calls Between now and Jun monthly options expiration, SOXS should makes it way back into the mid-to-high $20's, maybe even back to March levels well into the $30's.
