We hold two June 40-42 call spreads effectively for free after shorting two June 42 calls yesterday for 1.17 against June 40s bought earlier whose cost basis had been reduced by profit-taking to 1.17. What this implies is that we cannot lose even a dime on this trade no matter what the stock does, but we stand to make as much $400 if Silver Wheaton is trading above 40 come June expiration. For now, do nothing further. If SLW moves sharply higher over the next month or so, we would likely have an opportunity to trade out of the position for a nice gain before the options expire. As of yesterday’s close, the stock had exhausted its upside potential for the day with a thrust to 36.39 that exceeded the Hidden Pivot target shown by three cents.
