We recently scratched a small long position with the intention of buying it back at 6.11. Although the hourly chart (see inset) suggests First Majestic could fall to as low as 5.82 before it bottoms, I’ll recommend keeping in the bid at 6.11 for 400 shares. That’s a tick above the p2 ‘secondary pivot’, and therefore a promising place for the stock to turn if it is going to reverse its recent slide. We’ll want to buy more at d=5.82 if the opportunity arises, but I’m not inclined right now to use a stop-loss for any shares acquired at 6.11. _______ UPDATE (August 13, 10:10 a.m.): With AG getting dumped this morning and fills reported at 6.11 and 5.82, I am establishing as tracking position of 800 shares for an average 5.97. This is 30% less than the 8.48 some paid for the stock just a month ago._______ UPDATE (August 13, 1:38 p.m.): Offer one Aug 31 5.50 call @ 0.25 for each round lot of stock bought today, day order. (Order filled 1:57 p.m.) _______ UPDATE (August 14, 9:28 a.m.): So we don’t find ourselves rooting against a stock we own, let’s try to ‘uncap’ our covered write, initially with a 0.05 bid for as many Aug 31 6.0 calls are you are short 5.50s. This will give us a simple, vertical spread (for 0.20) against stock we own, rather than a covered write that caps our upside participation above $5.75. If no calls come at 0.05, I may suggest raising the bid to 0.10. This is a day order.______ UPDATE (August 14, 9:28 p.m.): Nothing new to suggest. Let’s avert our eyes for a day.
