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Let's Trade Options

  • #18,181
  • Sep 6, 2022 4:52pm Sep 6, 2022 4:52pm
Quoting Steamroller
{quote} Have you purchased both a call backspread and put backspread at the same time? I.e. you are expecting some directional movement In the stock market.
There's something to be said for getting in all parts at the same time. More often though I will try to do a little shopping and save a little $ on entries.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,182
  • Sep 6, 2022 5:20pm Sep 6, 2022 5:20pm
Quoting The Fool
There's something to be said for getting in all parts at the same time. More often though I will try to do a little shopping and save a little $ on entries.
....I got most of the legs filled in the set up above; there are some pieces left to fill here & there, and also, I will add a bit to the backspreads, if that looks good, up to the point where the debit for the backsprds is covered by 80% of the ICs' yield.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,183
  • Sep 6, 2022 8:41pm Sep 6, 2022 8:41pm
dbl backspreads projected to 9/12

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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,184
  • Sep 6, 2022 8:56pm Sep 6, 2022 8:56pm
....and the IC. Looking at the p/l comparison again, I see I could stand to increase numbers in the backspreads. Closer to 2:1 might be better. But I will watch. Might also roll down the put end of the IC, if that can be done for small loss or a gain.
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,185
  • Sep 7, 2022 3:14pm Sep 7, 2022 3:14pm
Rolled up the long leg of the put backspread, rolled down the short leg of the put vert. While cheap I will put money on a Nov/Dec USO fotm call diagonal - tried today @ $95/100 for 20c, didn't fill. USO options iv's spike with oil price spikes...
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,186
  • Sep 8, 2022 1:05pm Sep 8, 2022 1:05pm
Quoting The Fool
Rolled up the long leg of the put backspread, rolled down the short leg of the put vert.
bot back all the Sep12 SPX 3675/3650 bull put spreads for a nickel. If we get a drop, I will sell another put vert set @ Sep12, about 100 pts north.

The Sep14 SPY $375/372 backspread puts have all rolled up to $375/374, for another 6-7c debit. $374 is looking pretty low, for 3-4 dte, but we'll see. I will see if there may be anything else to put on for the bear side to catch a bear move Sep14 or later.

I am watching the call side and will roll up the short leg of the SPX bear call vert and roll down the long leg of the call backspread if/when that can be done for pennies. I don't like to have wide backspreads, must avoid the Valley of Death.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,187
  • Sep 10, 2022 10:48am Sep 10, 2022 10:48am
Took a 4% loss on trade above. Call SPX bear vert set at 12 delta was attacked Friday, I closed it for a $6-7 loss rather than try to manage it, given 9/12 expiry and expected volatility next week. SPY backspread hedges did well to hedge (about 5x return), but there needed to be more of them. I knew that, didn't add enough, gambled on that and lost. So that was a failure. I'd like to eliminate gambling mo as much as I can. Risk management always needs to be #1.

But I live to trade another day. I am set up again to catch a move off the CPI Tues. I expect a lowering core and that to be a bullish catalyst, but playing something bear side also.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,188
  • Sep 10, 2022 1:34pm Sep 10, 2022 1:34pm
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,189
  • Sep 10, 2022 11:21pm Sep 10, 2022 11:21pm
Near term it's the same old game - what does the econ news mean for the Fed's tightening regime? CPI release pre-market Tuesday will be a binary event. Stocks will rally if the numbers print lower than expected, and they will likely dump if inflation is increasing.

Glancing at the chart, to me looks like 4,200 is well within reach by opex Friday in the bull case. Bear case could see a slide back to 3,950 or even 3,900 by the same day.

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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,190
  • Sep 10, 2022 11:38pm Sep 10, 2022 11:38pm
Would you risk $2,500 for a chance to make $20-$30k in a week? I'll be watching Monday & expect some green follow through on the very bullish moves last Thurs-Fri. IV's are going to slide under 0.2, and calendars like the ones shown will get cheaper.

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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,191
  • Sep 12, 2022 12:39pm Sep 12, 2022 12:39pm
one of several youtube chartists I glance at

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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,192
  • Sep 12, 2022 12:46pm Sep 12, 2022 12:46pm
what I have for post CPI, SPX dbl calendars, some others are closer like 3950/4230, still adding....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,193
  • Sep 12, 2022 1:06pm Sep 12, 2022 1:06pm
Alternatives to natural gas eh. You are aware that natural gas is called the widowmaker, correct? NG was historically far more volatile, but it remains a challenging commodity to forecast. Perhaps you might sell a front-month put at a price of 18 to create a diagonal bear spread. Bring in some time premium to counteract your own. However, you would lose a portion of your negative profitability in the case of a decline in NG...but how probable is that?
  • #18,194
  • Sep 12, 2022 2:59pm Sep 12, 2022 2:59pm
Quoting VictorTJones
Alternatives to natural gas eh.
...I'm not following you. I'm not trading any ng derivatives.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,195
  • Sep 12, 2022 3:02pm Sep 12, 2022 3:02pm
Quoting The Fool
one of several youtube chartists I glance at https://www.youtube.com/watch?v=ytCVUw6cVos
I occasionally watch slims videos too. It will be interesting if the next cycle is as he forecasts.
  • #18,196
  • Sep 12, 2022 3:11pm Sep 12, 2022 3:11pm
Quoting Steamroller
{quote} I occasionally watch slims videos too. It will be interesting if the next cycle is as he forecasts.
do you think he is "right"? ...sometimes?...ever?
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,197
  • Sep 12, 2022 3:13pm Sep 12, 2022 3:13pm
Quoting VictorTJones
Alternatives to natural gas eh. ?
...you can use the ( " ) button to quote somebody's previous post in your own - that way they might be able to follow you better.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,198
  • Sep 12, 2022 3:18pm Sep 12, 2022 3:18pm
same idea w/ Qs, entered near the close.
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #18,199
  • Sep 12, 2022 3:24pm Sep 12, 2022 3:24pm
Quoting The Fool
{quote} do you think he is "right"? ...sometimes?...ever?
I wouldn't bet the farm on the cycle indicator as It doesn't align with market moves accurately enough to trade off of. The magnitude of the move is unknown and it won't capture trend changes. What is useful though is to understand his thought patterns and potential turning points. I disagree that we will go down to SPX lows again without some significant news.
  • #18,200
  • Sep 12, 2022 3:57pm Sep 12, 2022 3:57pm
Quoting Steamroller
I disagree that we will go down to SPX lows again without some significant news.
...my take on equities is they are just like a helium balloon, they always want to rise and will, unless there is something pushing them down. And it's the suspicion of the downward force that works as much as the actual force itself. These days, the suspicion of ffr increases is mostly baked in; suspicion of future recession maybe also, (perhaps mistakenly.) There are lots of wild cards that could come into play, but those are hard to trade off, because they could come up anytime, or never. Primary there is the end or cessation of the Ukraine war (rumored or actual) - no doubt in my mind the latter would pop US equities >10% in a week.
"If The Fool persists in his Folly he will become wise." - William Blake
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