Holding a soon-to-expire options position in this high-flier has given us an acute sense of the drag on the stock market as the year draws to a close. The thieves who manipulate NFLX in particular have been pretty brazen about bull-trap openings, and every rally over the last two weeks has faded in the stretch. Under the circumstances, we can be fairly certain that ‘everyone’ was looking for a holiday season rally, and that, like us, many used high-beta NFLX as their vehicle of choice.

My hunch is that the rally will come, pushing this stock to $400 or so by expiration, but that it will come too late to save our spread.  By this logic, a very steep rally will get under way perhaps next Wednesday, possible in the afternoon.  Accordingly, we might look to buy some cheap out-of-the-money calls with just a couple of days left on them next Tuesday or the following morning. Meanwhile, continue to offer half of the eight December (21st)  400-410 call spreads to close — but for 0.50 now. They feel like dead meat to me at this point. _______ UPDATE (November 11 at 11:10 a.m. EST): With the stock up $7.50 at the moment on top of yesterday’s strong gain, the spread is do-able for 0.50, but I’ll wait for reports of fills in the chat room before I make it official. That would leave us with four spreads and a total position cost of $120. For now, offer one more spread to close for 1.20. ______ UPDATE (December 12 at 10:26 a.m.): Sell four December 400 calls to close for 0.48 or better.  This order supersedes all others given above and will leave us with a bull ratio spread. _______ UPDATE (10:28): The calls went to 0.54 bid, so I’ll record a sale at 0.53 unless subscribers report doing worse. This will leave us with four December 400-410 ratio spreads (1:2) and a maximum of $190 to lose. That figure includes the sum we had staked on a bear spread in DIA.