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Let's Trade Options

  • #3,661
  • May 18, 2014 12:27am May 18, 2014 12:27am
Quoting The Fool
"Gold is a funny vehicle for trading...." http://247wallst.com/commodities-met...art-allows-it/ April-May of last year was a fun time to trade gold....kind of a snooze lately.... {image}
I don't trade gold derivatives much. I don't understand the gold trade. Crossing the whole pm patch off my list is good for me because my list is too crowded as it is. But if I thought we were in for more sideways action in the gold price, I might look for some IC action on GLD....what might go wrong with the trade below?
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,662
  • May 18, 2014 12:46am May 18, 2014 12:46am
Quoting The Fool
EEM looking tippy, good volumes in the Jun put strikes, $42 down to $38.... Bear call credit spread might be a play.
EEM not been above $45 since mid-2011. There's not much juice in the options, though. Maybe I will do a double debit spread...I need to diagonalize the spreads shown below, though. Even so, will I make much...?
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,663
  • May 18, 2014 8:26am May 18, 2014 8:26am
Quoting The Fool
{quote} I don't trade gold derivatives much. I don't understand the gold trade. Crossing the whole pm patch off my list is good for me because my list is too crowded as it is. But if I thought we were in for more sideways action in the gold price, I might look for some IC action on GLD....what might go wrong with the trade below? {image} {image}
In what way is the PM trade a crowded trade? I would have thought it's the very opposite of a crowded trade right now.
I have no clue what I'm talking about.
  • #3,664
  • May 18, 2014 11:39am May 18, 2014 11:39am
Quoting Boy Wonder
{quote} In what way is the PM trade a crowded trade? I would have thought it's the very opposite of a crowded trade right now.
Sorry, BW, I meant my trading list is crowded and that it is helpful to take that pm sector off my radar. I don't really trade or watch much oil these days, either, although I should. Mostly I am looking at the indices and at individual equity names. I try to watch anything else for opportunities, though, like the short natgas trade I am in.

Idk, there are people who trade just a few instruments who do well and there are those who look for their favorite tradeable scenarios across a wide list of names and do well, also - I am somewhere in between. I could see moving to the former camp, though. Already most of my volume typically is spread across a few index and treasury etf's...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,665
  • May 18, 2014 12:01pm May 18, 2014 12:01pm
Quoting The Fool
{quote} Sorry, BW, I meant my trading list is crowded and that it is helpful to take that pm sector off my radar. I don't really trade or watch much oil these days, either, although I should. Mostly I am looking at the indices and at individual equity names. I try to watch anything else for opportunities, though, like the short natgas trade I am in. Idk, there are people who trade just a few instruments who do well and there are those who look for their favorite tradeable scenarios across a wide list of names and do well, also - I am somewhere in...
No worries mate, my apologies for misunderstanding you.
Re natgas, I've seen that you're short. I've been trading this from the long side, with generally good success, apart from when I was long when it exploded and then I got myself in all sorts of trouble by trying to be too clever by half by trying to trade it in both directions. That was a really, really, really sweaty time for me. To be honest, I'm sorry to say I think that pipple might have been seriously hurt by that natgas move. That was the last time that he posted here afaik, and he is a heavy futures options seller.
Anyway, I think for now natgas is ranging (correcting sideways with large swings) but sooner or later I think it's going to resume upwards. I like selling puts a bit lower than here or going outright long. But each to his own
Still thinking bonds to come off a bit here, maybe for just a few days or a week, let's see.
I have no clue what I'm talking about.
  • #3,666
  • May 18, 2014 12:20pm May 18, 2014 12:20pm
Quoting Boy Wonder
{quote} I'm sorry to say I think that pipple might have been seriously hurt by that natgas move. That was the last time that he posted here afaik, and he is a heavy futures options seller. Anyway, I think for now natgas is ranging (correcting sideways with large swings) but sooner or later I think it's going to resume upwards. I like selling puts a bit lower than here or going outright long. But each to his own Still thinking bonds to come off a bit here, maybe for just a few days or a week, let's see.
he might've lost money but I doubt he was seriously hurt. pipple appeared to be covering both ends very actively.

which is what I will do on my UNG puts, just looking for a little more dippage. I'm $0.07 in the hole on long Jul $20 puts and I am looking for short Jun puts around that level that break me even or better. With luck I'll see that in the coming week. Natgas is a real interesting trade, enjoys a mix of probably flagrant market manipulation and raw fundamental influences. Bottom line though, if there is a persistent forecast for cooler than normal summer temps in the eastern US, the price will go down.

re: long-end treasurys - I am imbalanced short there, too, but not by much. Actively spreading TLT and TBT. It's a close call, but I think US equities will nudge up and treasurys will slide in the coming 1-2 months. Upcoming bond auctions will be watched closely.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,667
  • May 18, 2014 12:31pm May 18, 2014 12:31pm
Quoting The Fool
{quote} he might've lost money but I doubt he was seriously hurt. pipple appeared to be covering both ends very actively. which is what I will do on my UNG puts, just looking for a little more dippage. I'm $0.07 in the hole on long Jul $20 puts and I am looking for short Jun puts around that level that break me even or better. With luck I'll see that in the coming week. Natgas is a real interesting trade, enjoys a mix of probably flagrant market manipulation and raw fundamental influences. Bottom line though, if there is a persistent forecast for...
Why spread TLT *and* TBT? If you're bearish treasuries, you can trade that view using just TLT or TBT. Personally, prefer to sell calls on ZB because the bang per buck is so much higher. Which is fine until it doesn't work....

Equities, I agree, I think there's more upside coming.
I have no clue what I'm talking about.
  • #3,668
  • May 18, 2014 12:38pm May 18, 2014 12:38pm
Quoting Boy Wonder
{quote} Why spread TLT *and* TBT? If you're bearish treasuries, you can trade that view using just TLT or TBT. Personally, prefer to sell calls on ZB because the bang per buck is so much higher. Which is fine until it doesn't work.... Equities, I agree, I think there's more upside coming.
TLT/TBT are basically the same thing, spreading on both just opens up more space for adjustment. For instance, if I think long bonds are heading up I might do a bull put spread on TLT. If instead I go long TLT and TBT at the same time, I can wait to see what happens and spread on both with some advantage.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,669
  • May 18, 2014 12:58pm May 18, 2014 12:58pm
Quoting The Fool
{quote} TLT/TBT are basically the same thing, spreading on both just opens up more space for adjustment. For instance, if I think long bonds are heading up I might do a bull put spread on TLT. If instead I go long TLT and TBT at the same time, I can wait to see what happens and spread on both with some advantage.
Okay, what works for you works for you
I have no clue what I'm talking about.
  • #3,670
  • Edited 1:32pm May 18, 2014 1:13pm | Edited 1:32pm
So the fed heads yakking about "the taper" in 2013 will be yakking about the "rate hike" in 2014.

http://247wallst.com/economy/2014/05...than-expected/

" A rise in commodity prices and food prices could act as the hidden wild card that would force Yellen into raising rates. Food prices have in many cases gone through the roof. Crude oil has slowly crept back up to more than $101.50, and the average price of gas per gallon is around $3.63 now. What if food prices rise too much, and what if gasoline gets back over $4 per gallon everywhere rather than just in higher-taxed pockets?

Housing has been in the tank again, but some positive metrics have been seen. If the Fed believes that a small rise in rates will not kill housing, then perhaps they will act sooner than expected. And now (in a move that got us in trouble before) the FHFA wants banks and regulators to loosen up on their lending standards for mortgages.

It seems unlikely that Yellen will jump the gun on rate hikes. After all, Fed chairs in the past get criticized for hiking rates too much more than they do for keeping the easy money flowing a little longer. The problem is that quantitative easing is ending and the easy money via low rates seems to keep getting more and more critics each month. "
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,671
  • May 18, 2014 1:25pm May 18, 2014 1:25pm
http://www.emanuelderman.com/
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,672
  • May 19, 2014 1:41am May 19, 2014 1:41am
I am wondering if the ATT - DirecTV acquisition is bad news for CTL? Currently CTL bundles DirecTV service with their phone/isp, not sure if that will continue with ATT owning DirecTV...? CTL sitting at a 15-month high....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,673
  • May 19, 2014 1:55am May 19, 2014 1:55am
hey, welcome back to the funhouse PTL, hope you is doing well.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,674
  • Edited 2:07pm May 19, 2014 1:38pm | Edited 2:07pm
Quoting The Fool
{quote} I don't trade gold derivatives much. I don't understand the gold trade. Crossing the whole pm patch off my list is good for me because my list is too crowded as it is. But if I thought we were in for more sideways action in the gold price, I might look for some IC action on GLD....what might go wrong with the trade below? {image} {image}
I did the call side of the GLD IC shown above, for $0.26 net credit.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,675
  • May 19, 2014 2:10pm May 19, 2014 2:10pm
Quoting The Fool
BMY to bounce on $48, or break down....? {image}
missed the chance on a fast dip to near $48 today, not a priority....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,676
  • May 19, 2014 2:14pm May 19, 2014 2:14pm
Quoting The Fool
ER's up next week: 5/20: HD, CRM, SPLS 5/21: HPQ, LOW, NTAP, PETM, SINA 5/22: BBY, DLTR, GME, SHLD
I'm not sure if I want to diddle around with any of these....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,677
  • Edited 5:42pm May 19, 2014 3:15pm | Edited 5:42pm
Quoting The Fool
{quote} TLT/TBT are basically the same thing, spreading on both just opens up more space for adjustment. For instance, if I think long bonds are heading up I might do a bull put spread on TLT. If instead I go long TLT and TBT at the same time, I can wait to see what happens and spread on both with some advantage.
so I am spread on both TLT and TBT, bearish on TLT and bullish TBT, and that worked out well for me today, but I gave some back on SSO (the 2x bullish S&P etf)
where I am imbalanced bearishly. Need to do something about that... Jul UNG long puts were whacked today, be interesting to see how the storage build numbers come in later this week.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,678
  • May 19, 2014 3:19pm May 19, 2014 3:19pm
Quoting The Fool
{quote} EEM not been above $45 since mid-2011. There's not much juice in the options, though. Maybe I will do a double debit spread...I need to diagonalize the spreads shown below, though.
EEM had a dead flat day. EEM been rallying on falling rates, and if/when the turn there is plain to see, EEM will be falling off is recent highs. If/when....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,679
  • May 20, 2014 2:12am May 20, 2014 2:12am
expectations must be pretty high for HPQ, sitting near a 2-yr high, inverse H&S suggests $35 will be breached?, reports 5/21...echoes CSCO?
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #3,680
  • May 20, 2014 1:56pm May 20, 2014 1:56pm
Quoting The Fool
{quote} I did the call side of the GLD IC shown above, for $0.26 net credit.
GLD flat again. Dow down 160, gold barely moved....
"If The Fool persists in his Folly he will become wise." - William Blake
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