A fluid approach to trading

Just closed this short term trade at 1.70

Entered WYNN (84/82) Put Credit Spread for .78, expires Friday July 19. Goal is to close for .15 or lower.

Closed this out this morning for .38 for +.48 profit on the spread. It could go up further or level out over the next couple of trading days, but since this was sharp upswing, taking profit here seemed wise

I put on this SPX diagonal shortly after the open today. Now we're down 1% - who saw that coming? Likewise, who saw the meltup run yesterday coming? Well, the meltup is old hat, but we all knew a pullback is due. Heavy rotation today out of megatechcaps (/NQ down 2%) and into small caps (/RTY up 3%). We'll see if it's just a one day deal.

Anyway, I like trading the "AM/PM" SPX spread, which happens once a month at the old monthly opex. The trade can go on usually for a small credit even at $5-wide, or, as shown, $0.70 for the $10-wide. The plan is to ride it til Thursday close. There will still be some juice left in the AM short leg, which closes pre-market Friday, so the max profit is not as good as a normal 1-day diagonal, which I usually put on to span Friday-Monday. But, they go on super cheap and can often get a couple bucks profit. This morning, with cool inflation data out, I assumed the spoos would try for 5700 next week. Now, who knows? If it keeps going down, my consolation will be the $0.70...

Nice, I can't say that I've ever put on a diagonal spread. I think this was solid strategy for today, I like the potential this can give you if you happen to land in the sweet spot.

I don’t see any short term setups to enter today, but I did enter a longer term Put Credit Spread on LULU, this is definitely one I will roll if it continues to drop. I have about 10 or so of these types of positions on other stocks open at the moment, a couple of which I’ve already rolled once or twice since April that have turned into longer term positions. I should have some good examples moving forward when positions start moving against me here in this journal.

Entered LULU (290/280) Put Credit Spread for 3.91, expires 8/9.

I would have liked to keep this on a bit longer, but given it's a short term long call, I don't want to hold too much longer. Had I purchase another week out, I would have held I think. I closed this at 2.86 for +.31. If this drops again tomorrow will likely enter again.

I'll be closing this out tomorrow for a loss, and I’m not going to roll this trade like I initially thought I would, as I don’t have the confidence in doing so, like I do for most stocks. This was taken in my taxable brokerage account. For tax reasons, I’ve been trying to get something consistent working with Futures Options trades, but not too successful yet. The account has just fluctuating around the same balance for a few months now.

The equity options trades are all placed in my IRA accounts and I don’t need to worry about the tax ramifications. I have full confidence in these accounts as the variety that I need is clearly available, and I can place plenty of trades. A trade or two a day, spread out over expiration dates, some longer term, some short. All mostly long positions, with small amount of shorts spreads and long puts.

I think I will minimize the amount of trades taken in this account and focus on the extreme extended zones that I tend to gravitate towards. This will be fewer trades, not sure how many, maybe one every couple of weeks, we'll see. The main problem is that I am limited to a small watchlist. Right now it’s the list below:

/ES E-mini S&P 500 Index Futures,
/6A Australian Dollar Futures
/6B British Pound Futures
/6C Canadian Dollar Futures
/6E Euro FX Futures
/GC Gold Futures
/NQ E-mini Nasdaq 100 Index Futures
/RTY E-mini Russell 2000 Index Futures
/CL Light Sweet Crude Oil Futures
/ZB 30-Year U.S. Treasury Bond Futures

A short term play in case of a rapid pullback to 16.50 area. Entered long put at 17 strike next week exp, for .72. Will close quickly if there's a drop.

Closed this morning for 2.45

Long 72 Call (7/19 exp) for .72

Some guidelines for myself as a move forward. There's really no rules as far as a system goes, as entries and exits are all discretionary, but it is important for me to have guidelines to refer to, especially on days that I'm not really seeing or feeling much conviction or confidence.

Continue to mix short and longer term positions, along with a variety of spreads and long option positions.
Close positions early when in profit, especially on strong up days for long call trades.
Moving forward, simplify watchlist. Mainly SP100 stocks, but can extend to SP500 and others, use common sense. As for futures use only the handful of futures that I listed a few posts above.
On stock positions keep short positions short term, and only as minor hedges when long positions are increasing.
Enter positions at the end of day, during the last hour of US trading session.
Every entry must have a fixed target zone.
1H and Daily charts give me the best perspective.
Only roll long positions on stocks and indices, can roll either way on currencies.

The next thing I'm working on is I would like to start a small separate account to place trades of the highest probability. This would be trades based off of my larger account, where I have likely rolled positions that have gone against me without retracement, and that are in the extreme extended zones. Would be risking a higher percentage of the account, looking to compound it in a relatively short amount of time, taking advantage of the options leverage. Ideally I would take this towards a set goal where I would then reset and start another account with the same goal.

With my larger account I trade conservatively, risking as little capital as possible while trying to achieve my monthly target, this protects me against large market moves and allows me to add to positions if I choose to. The idea of have smaller more aggressive accounts would allow me to take advantage of the leverage of options while allowing for the occasional series of losses that could blow an aggressive account. The account is essentially the stop loss, and the beauty of options and the way I trade them is I cannot go into negative balance.

Missed the initial run up. Closed the NKE long at .82

Entered NKE (73/69) Put Credit Spread for 1.26, expires 7/26.

Entered BMY (41/38) Put Credit Spread for .97, expires 8/2.

Finally a currency position, Australian Dollar

Long .665 Call (Aug exp) for .011

Will close this one out quickly if it moves against me

Long 160 Call (7/19 exp) for 2.65
Short term trade, I think it has a good chance of a quick upward move. Would consider rolling this one out another week or do if it doesn't

Closed this out at 4.90
Note, error on the post with the entry, I entered at 3.65 not 2.65

Long SBUX 72 Call (7/26 exp) for 3.55

Closed this today for .50 profit