Hi everyone, I had a quick update for you all.
MRO has surprised me without follow through selling today, so unless we go significantly lower this week (to near $8), I don’t plan to sell it. I still want to sell near 11 or 12, but am thinking about making my position into a covered call to reduce downside risk. For example, I can sell a 2 month out call to avoid paying short term capital gains. If I hold for another 2 months, that puts my holding period at just over a year.
XPEV also surprised me today. I had planned to buy it if it gapped down, but it gapped up and never stopped going up. I thought the upward momentum was broken, but apparently not. I probably won’t be entering it for a while since earnings are coming up soon.
I learned a couple things from this trade though. Knowing myself, I likely would have sold near the bottom at around 48 on Friday in an attempt to protect my profits. This means I either have to learn to accept the violent swings of the market and watch my large profits get back to small profits / break even, OR I need to take trades that will play out in a shorter period of time (3-5 days instead of 2-3 weeks for example).
The way to take shorter trades would be to use a tighter stop loss with a closer profit exit as well. I’ll start experimenting with this idea for my next trade.
XPEV daily chart below: