NOC had a monster gap down on missed earnings followed by analyst downgrades. My whole trading philosophy revolves around mean-reversion and this includes taking advantage of any kind of market over-reaction. With NOC, the downward pressure started losing momentum as indicated by the shrinking red candles, DI- changing direction and RSI flattening out. The trade has relady started going in my direction and is beginning to look good. PS: For any new members, I am never trying to catch the bottom with my trades and you will find that 90% of my trades initially go against me after putting them on. This is the reason why you will see me reminding our group not to jump at trade alerts the moment you see them. Patiently waiting for a few hours or even a day will give you some really good entries. I recommend that you keep a trade log for 2 weeks and track what happens to a stock after I push out a trade alert and see for yourself if waiting would be more rewarding or not. In this particular case, NOC fell down to $349 before recovering.

NOC initially took off in my direction, before giving up all the gains. Although, this trade will most likely close for full profit for our members who are holding it, I closed it earlier for less profit because NOC has a dividend coming up on 11/26. Now, Dividends are not the end of the world, but can get annoying. Here is what could happen - The dividend is 1.57 and extrinsic value of the short call is 2.5. Now, if somebody exercises their 360 call to capture the dividend, they will need to give up the 2.5 in extrinsic value. Now, this doesn't make sense at all. i.e Why would you lose $2.5 to gain $1.57? This is the reason why any kind of assignment happening due to dividend is pretty low. However, we have a Holiday tomorrow and it is difficult to predict what the extrinsic value of the 360 call on Friday at open would be. To avoid the hassle of assignment, I decided to close it today prematurely.