It looked like the market was going to fall off a cliff this morning but the bulls have stepped in and have now taken the market higher. Although volume is light, the Dow has rebounded off its low of 9,131 and is now up 89 points to 9,307. The Nasdaq is up 14 to 1,970 while the S&P 500 is up 9 to 998.
Abercrombie & Fitch (ANF, $31.35, down $0.12) traded to a low of $30.16 and here is what I said last night:
“The stock traded to a low of $31.25 and a break below $31 clears the way to our exit target of $30 for the stock and $2.50 for the puts…”
Bingo. The September 32 puts (ANFUJ, $2.35, up $0.20) traded to a high of $2.90 this morning so you should have at least sold half of the position at $2.75. Our EXIT target was $2.50 and these puts blew right thru that. We have a stop of $1.85 in place and we can raise this to $2.00 for the other half of the position.
I’ll be back tonight or in the morning with another update.