I’ve mentioned my 100% commitment in my options account to my October 16 $34 puts on the Brazilian fund EWZ. I noticed something curious last week which another reader wrote me about: this fund’s propensity to shoot up higher in the morning and then retreat afterwards. Even in the past couple of days, we can see this plainly:
Looking at a longer timespan, I see exactly the same thing. I have no idea what causes this.
It is comforting, however, because until I noticed the regularity of this “morning shock”, I got tempted to just cut and run. Now that it’s clear to me how predictable this fake-out is, and the fact one of you confirmed in with his own experience, I am far more confident rolling my eyes at the morning spike (like this very morning) and simply watching the bugger melt away once the scare tactics are through.
