A week of lessons learned

I learned a couple of hints this week that will help me improve the profitability of my covered call trades in the future.

Thanks to a hint from  the Daily Options Report, it is not a great idea to sell a call the Monday after expiration to get recovered. All the other covered call players are doing the same. If I had waited 2 days to cover my position in DYN I would have gotten another dime for the call.

In my short time if doing this it appears earning releases have a higher probability of depressing a stock price. Any chance of good news seems to build into the price before the actual release. If estimates are exceeded the price remains stable. If the estimates are met or earnings come up a little short the stock price decreases. SLW dropped by $.40 when earnings came up 2 cents light. If I had sold a call the day before estimates would have made another dime.

BTW, I did sell the June $12.50 call on SLW yesterday for $.30. I think this stock has great potential, so I am writing further OTM calls to make some extra income while waiting for the price appreciation.

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