The Shelf of Support

For a while, I mentioned the "rectangle of resistance" on the IWM. That rectangle was half-penetrated early this week, and although the market has softened up a bit, now the bulls have something equally formidable in their favor - - a "shelf of support" (I'm in a phrase-coining mood this morning). So we're between the proverbial rock and a hard place at this point; it's going to take some serious buying by the bulls to push above resistance, but it's going to take even more dramatic selling by the market by melt through all this support. It's a tough call.

On a shorter-term, positive note, I got out of my APOL puts this morning for a profit of about 120%. Given the 20% plunge in price, that's not a huge profit, but my option plans tend to be relatively conservative (in the money, several months out). So it's not the multi-hundred percent gain I'm sure others had. What's particularly nasty about these deep in the money puts is that the market is barely willing to pay intrinsic value for them, and sometimes the bid is even less! Oh, well. I'm out and I took a nice profit, so how can I complain?