No. I haven’t learned anything yet.
During the rocket ride up for MSTR – Microstrategy Inc. I sold covered calls, significantly reducing my potential profits.
Then, from March 15 to March 19 MSTR crashed 32%, but assuming the rocket ride up would continue, I was not covered, so I suffered the downside and lost the upside.
On March 19, I sold the $1,400 calls just before the bounce back and had to cover them at a significant loss.
I did manage to cover again on March 20, and March 22, fo a small profit, but the damage was done, and my experiment in writing covered calls in a screaming bull market cost me $351.
The only good news in this sorry tale is that on February 8, when I did the first covered write, MicroStrategy was trading at $580 per share. On March 22 it closed at $1,523, so my share position is up $973, so the $351 loss doesn’t look quite so bad.
Now what?
I have no idea.
The obvious answer is to sell MSTR and book the profits on the stock position, and move into something less volatile. But what’s the fun in that?
Bitcoin hit an all-time high on March 14 of just over USD 73,000 and has since pulled back 17% before recovering slightly to sit at $64,440 as I write this at 7:30 am on Saturday, March 23. There is support at $62,500, then just under $60,000, and then nothing until $52,000.
Will it fall to $52,000? Perhaps. The hype over the ETFs has died down. Bitcoin ETF inflows were a lot lower this week (not surprising given the drop in the Bitcoin price):
Significant outflows from GBTC were not absorbed by the other ETFs.
My guess is that Bitcoin will consolidate between now and the halving around April 19, 2024, and then the big uptrend will continue in May and onwards.
So, I will likely cover MSTR again this week, and sit and watch.
Crazy, but fun to watch.
Stay tuned for further reports.
Have we learned anything yet?
by JDH on March 23, 2024
No. I haven’t learned anything yet.
During the rocket ride up for MSTR – Microstrategy Inc. I sold covered calls, significantly reducing my potential profits.
Then, from March 15 to March 19 MSTR crashed 32%, but assuming the rocket ride up would continue, I was not covered, so I suffered the downside and lost the upside.
On March 19, I sold the $1,400 calls just before the bounce back and had to cover them at a significant loss.
I did manage to cover again on March 20, and March 22, fo a small profit, but the damage was done, and my experiment in writing covered calls in a screaming bull market cost me $351.
The only good news in this sorry tale is that on February 8, when I did the first covered write, MicroStrategy was trading at $580 per share. On March 22 it closed at $1,523, so my share position is up $973, so the $351 loss doesn’t look quite so bad.
Now what?
I have no idea.
The obvious answer is to sell MSTR and book the profits on the stock position, and move into something less volatile. But what’s the fun in that?
Bitcoin hit an all-time high on March 14 of just over USD 73,000 and has since pulled back 17% before recovering slightly to sit at $64,440 as I write this at 7:30 am on Saturday, March 23. There is support at $62,500, then just under $60,000, and then nothing until $52,000.
Will it fall to $52,000? Perhaps. The hype over the ETFs has died down. Bitcoin ETF inflows were a lot lower this week (not surprising given the drop in the Bitcoin price):
Significant outflows from GBTC were not absorbed by the other ETFs.
My guess is that Bitcoin will consolidate between now and the halving around April 19, 2024, and then the big uptrend will continue in May and onwards.
So, I will likely cover MSTR again this week, and sit and watch.
Crazy, but fun to watch.
Stay tuned for further reports.