I’m tracking a 500-share, long-term position with a cost basis that has been reduced by timely profit-taking to 128.02. Last week, TLT breached a key support at 131.76 that had been noted here earlier, putting a worst-case correction target at 130.50 in play (see inset). We’ll look to augment our long-term position, still profitable even at these levels, with a 130.56 bid for 800 more shares, stop 130.39. Alternatively, you can bid 1.00 (but no more) for a dozen Dec 16 135 calls, good till canceled. That’s a ballpark figure for the options at this point, but check for updates if it gets close, since I may allow discretion of a nickel or so on the bid. ______ UPDATE (Oct 27, 10:50 p.m.): The 0.44-point breach of 130.50 has bearish implications going forward, although TLT will have a chance to turn from here, since the low fell just four ticks from the 130.02 midpoint Hidden Pivot support of a lesser but still important ABC pattern (120-min, A=139.07 on 9/29). If the support fails, we could see more slippage to 128.15, or possibly even 126.28. _______ UPDATE (Nov 9, 7:55 p.m.): This position has been distracting my thinking even as I’ve remained frozen at the wheel. In order to ‘clear my head’ so that I can contemplate signs of inflation with objective detachment, I’m going to try to close out the tracking position with a 126.50 offer, good till canceled. Check back intraday, since I may change the exit strategy to a market order.
