Thursday, December 2, 2010

12-02 NUE --- know when to fold them

Over the past several months NUE has presented you with several nice trading ops.  But, we have to know when to leave so as not to overstay our welcome.  Today I sold my NUE.  Why?  Because in December two longer cycles top and turn down and this increases the downside risk.   The next downturn in NUE could see it drop below the recent $37 support and if it does the low $30s look attainable. 

So IMO there is $8-10 of doewnside risk and maybe $1 more to the upside.  I don't like those odds so I will watch from the sidelines.

Look for yourself:

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3 comments:

  1. SJCDecember 8, 2010 at 1:41 PM

    Hey Inlet,

    I agree on Nue, I took a position today with the Jan 41 puts. Would like to see at least 37 soon

    ReplyDelete
  2. InletDecember 9, 2010 at 4:40 AM

    SJC,

    Good luck. Hope you bought puts far enough out (ie Jan) to give it time to play out.

    ReplyDelete
  3. SJCDecember 9, 2010 at 5:06 PM

    Inlet,
    Yes i bought the Jan 41 put

    ReplyDelete

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