I got a pleasant surprise after the close yesterday, when I saw one of my short position charts begin to spasm unexpectedly. It hadn’t occurred to me that Arm Holdings (ARM) had an earnings report, and I’m sort of glad that I didn’t, because the initial reaction would have given me a heart attack, since ARM spiked higher for a few moments. In short order, it went into a free fall, in spite of its absolutely bargain-basement value of a 492 price/earnings ratio.
The overnight lows actually were the lowest prices in months, but where I’m struggling a bit right now is how long to hold it. Actually, I’m not really struggling, since I’m inclined to sit tight with these puts, since the market overall is, once again, insanely overvalued, and these puts don’t expire for 78 freakin’ days.
I’d be interested in knowing from any fellow swing traders out there what they think a good exit would be.
