EXM Options

Given the huge selloff in EXM yesterday...today, I took a $7 July CALL position $0.65 per contract - assuming that yesterday shook out a lot of sellers. The stock is sitting around $6.70. I am not as confident in this trade because I am going against my original theory of this stock trending to lower values based on it's channeling history...so I will put a stop on it at $0.50 and a limit on it at $0.85.

Update: I should have trusted my gut...that one tripped my stop before I could even finish breakfast! Ouch, a quick 25% loss to offset those nice gains.

Update 2: I quickly established a $6 July PUT position against EXM at $0.55 since EXM is clearly dropping like a rock today. Something I was thinking about doing this morning as insurance against my gut was to use a straddle. Had I used a straddle I would have definitely been in a much better position as my CALLs would have sold at a modest loss and my PUTs would still be running in the money. Will have to see where this goes...