Thursday, April 20, 2006

And just bought some more puts on GBP:

Just bought a 1.7300 PUT on GBP/USD expiring May 12th...£10/cent for
10.4 cents, £104. Small premium but big upside.

GBP has been really interesting lately, having been my biggest position
I've been following the price action closely, and someone somewhere has
been buying it for a while. When it was down around 1.75/1.76 area, even
when "bad" news for GBP came out, it would drop half a point before
resuming its steady upward climb, which has now pushed it up to 1.78
from close to 1.72 not long ago. Whoever has been doing this buying will
have to stop at some point, and then the collapse will be imminent. I do
not want to miss this trade, so spending £104 for this exposure is a
tiny premium to pay.

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