On 1/19/10, I sold 5 BAC Mar10 18 Covered Calls for a net deposit of $131.18 in an IRA account.  My basis for these BAC shares is now 22.86, excluding dividends received.

At the time I sold these Calls, BAC was in the low 16′s and moving up.  It felt like a small risk to sell the 18 strike at that time.  I suspected that I might need to roll it out before expiration because it was moving up but there seemed to be some resistance around 17.50 which ultimately led me to choose the 18 strike.

Today it looks like I could have chosen the 16 strike price as BAC, along with most stocks, is falling.  It is at 14.92 as I write this.

S&P has a 12 month price target of $22 from a  report published on Jan 30, 2010.  I suspect that the current pull back in the market is short term temporary and BAC, along with other stocks, will be higher at the end of the year than they are now.  Companies are reporting increased profits, raising dividends and many are optimistic about the upcoming year.  It certainly seems like there is more pessimism in the market that is actually warranted.