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Let's Trade Options

  • #7,761
  • Edited 8:29pm Mar 18, 2015 6:42pm | Edited 8:29pm
Quoting StrayDog
{quote} And clarity we got. BTFD. Indices will at least test previous highs, and then, off we go... to new ones. Rate hikes fear are over, correction will come one day, but reason for it will be something else. Interested to see development around Oil now... Started to like trading it... Buy EUR dip? Oh, man... Say bye, bye, to parity now.
A trader can find some room for doubt in the euro rally, and maybe US indices might defer to strength in those of Europe. But I'd bet oil can continue falling despite USD weakness. /CL is down $0.50 in early Thurs trade.

One obvious (Danger! Danger!) setup is continued strength for UST's, which I trade via TLT. With dovish Fed in da house and big yield divergence between UST's and other sovereign debt instruments, with deflationary currents still strong everywhere, it seems obvious () that UST's will continue being bought, and I will look for bullish trades there...I'd bet TLT will revisit its prior highs in the high $130's within the next few weeks.
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,762
  • Mar 18, 2015 7:51pm Mar 18, 2015 7:51pm
more bullish TLT ideas
Attached Image(s) (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,763
  • Mar 18, 2015 9:38pm Mar 18, 2015 9:38pm
PBR, note the islands of low OI to find cheap options spread opps.
Attached Image(s) (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,764
  • Mar 18, 2015 9:52pm Mar 18, 2015 9:52pm
note the 33,xxx puts trade in the Jul chain shot above - that was a spread, somebody sold Apr $6 puts for $0.80 and bought Jul $5 puts for $0.78, as shown below,,,a bullish trade that will net >$1,000,000 if PBR trades between $5.85 and $6.75 at Apr expiry
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-03-18_pbr4.png Size: 62 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,765
  • Mar 19, 2015 2:24am Mar 19, 2015 2:24am
cra cra
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,766
  • Mar 19, 2015 7:10am Mar 19, 2015 7:10am
Quoting ZebraSquirl
{quote} They make it look slick and easy, which is probably a dangerous thing for the vast majority of folks ... .
Yeah, like "you can do it too...". But it is fast and free way to see majority of combos.
Hope is dangerous in this game.
  • #7,767
  • Mar 19, 2015 7:13am Mar 19, 2015 7:13am
Quoting The Fool
A trader can find some room for doubt in the euro rally, and maybe US indices might defer to strength in those of Europe. But I'd bet oil can continue falling despite USD weakness.
Yes, you are right. EU still has QE, and Oil still has a supply glut. Nothing changed there. I think re USD that the pullback from the obvious overbought territory could be a play, just maybe not with EUR. I have reentered short calls on USO, will watch situation and possibly add some more.
Hope is dangerous in this game.
  • #7,768
  • Mar 19, 2015 7:18am Mar 19, 2015 7:18am
Quoting The Fool
note the 33,xxx puts trade in the Jul chain shot above - that was a spread, somebody sold Apr $6 puts for $0.80 and bought Jul $5 puts for $0.78, as shown below,,,a bullish trade that will net >$1,000,000 if PBR trades between $5.85 and $6.75 at Apr expiry {image}
Hey TF... But, that is a put diagonal... that trade is bearish? It has done for $0.02 credit, so no risk from the upside...

But another question is this: weaker USD is good for Brazil, maybe this is a buy-able dip for their stocks... a short-term play.
Hope is dangerous in this game.
  • #7,769
  • Mar 19, 2015 9:01am Mar 19, 2015 9:01am
BTFD.... I just bought a couple of SPY March 210/210.5 call spreads for $0.11
Hope is dangerous in this game.
  • #7,770
  • Mar 19, 2015 12:05pm Mar 19, 2015 12:05pm
Quoting StrayDog
{quote} Hey TF... But, that is a put diagonal... that trade is bearish? It has done for $0.02 credit, so no risk from the upside... But another question is this: weaker USD is good for Brazil, maybe this is a buy-able dip for their stocks... a short-term play.
I think of that short diagonal as bullish, since the real risk is to the downside. I'd want to see PBR move up to stay away from that death slide....

I'm at a conference, can't trade, had orders set early this AM, will see what got hit after market
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,771
  • Mar 19, 2015 12:38pm Mar 19, 2015 12:38pm
I tried to get in that PBR Jul bull call vertical above for $0.09 - not even close, I saw $0.21 at the open.

I did get in TLT Apr/Apr4 $140 call calendar for $0.08 - so, of course, TLT slides. I've got a bunch of losers expiring tomorrow - ya win some ya lose some, everything is perfectly plausible when you get in....then 3 weeks later, Erkel says, "Did I do that?"....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,772
  • Mar 19, 2015 12:49pm Mar 19, 2015 12:49pm
Quoting The Fool
I tried to get in that PBR Jul bull call vertical above for $0.09 - not even close, I saw $0.21 at the open. ....
Pretty bad bid/ask spread on those options... PBR, VALE, EWZ... everything down... dollar weakness was just a few hours show, nothing more.
Well, watching from the distance. I have some spreads expiring worthless tomorrow also. Just hoping for some bullish action tomorrow, so that my latest SPY call spreads would not join the losing ones. Not asking too much, just retesting today's highs.
Hope is dangerous in this game.
  • #7,773
  • Mar 19, 2015 3:41pm Mar 19, 2015 3:41pm
Quoting StrayDog
{quote} Yeah, like "you can do it too...". But it is fast and free way to see majority of combos.
A good idea generator that may save me some time ... .

That $1 mil PBR trade is absolutely sick ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #7,774
  • Mar 19, 2015 6:37pm Mar 19, 2015 6:37pm
Quoting The Fool
I did get in TLT Apr/Apr4 $140 call calendar for $0.08 - so, of course, TLT slides. I've got a bunch of losers expiring tomorrow - ya win some ya lose some....
I also filled a Mar5/Apr1 $213 SPY call calendar for $$0.08, lol another small loser to burn my bum...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,775
  • Mar 19, 2015 6:53pm Mar 19, 2015 6:53pm
Quoting ZebraSquirl
That $1 mil PBR trade is absolutely sick ... .
I like trading diagonal spreads, but I don't have the margin to do them in any kind of size. A 20-lot is pretty big for me. x0,000 lot trades are the stuff of legend. Diagonals are tricky, though, definitely paper trade them first if you want to try them...

you can check out the biggest trades of the day if you have an account with a "Time and Sales" function....Yahoo has a free rundown of the biggest trades, but not complete for any symbol....

http://finance.yahoo.com/options/
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,776
  • Mar 19, 2015 10:27pm Mar 19, 2015 10:27pm
Mar SPY $210/$210.5 calls shown below, maybe we get rally action to close out the Mar cycle? I'd look for a nickel entry to make >2x if SPY can break above $210.25.

....puts are skewed & too dear
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-03-19_SPY.png Size: 35 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,777
  • Mar 19, 2015 11:38pm Mar 19, 2015 11:38pm
Quoting StrayDog
But another question is this: weaker USD is good for Brazil, maybe this is a buy-able dip for their stocks... a short-term play.
right, it's all about the USD for the em stocks - EWZ ranged up >$2.50 on the USD dump after the FOMC, need to see some persistent USD weakness for it to do that some more. Near-term (30dte m/l) calendars are cheap, maybe worth a shot
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 2015-03-19_ewz.png Size: 117 KB
Click to Enlarge Name: 2015-03-19_ewz2.png Size: 65 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,778
  • Mar 20, 2015 7:00am Mar 20, 2015 7:00am
Quoting StrayDog
BTFD.... I just bought a couple of SPY March 210/210.5 call spreads for $0.11
So far, so good... comms are a bitch, even on IB sometimes... my average price with comms is $0.136... If the same amount is going to be charged for closing, that only means I need $0.16 just to break-even. Comms are bigger on heavily traded instruments, I usually pay a buck and a half for a spread... or less.
Hope is dangerous in this game.
  • #7,779
  • Mar 20, 2015 7:08am Mar 20, 2015 7:08am
yeah I looked at that Mar SPY call spread, will look at otm diagonals further out. I filled the EWZ $34 call calendar just above for $0.09, let's see if some USD weakness can stick around. Maybe Janet Yellen told her minions to sell the USD ...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #7,780
  • Mar 20, 2015 7:38am Mar 20, 2015 7:38am
I wrote down yesterday some potential gamma scalps for today... like:
FB IF it retests $82 THAN go long (buy calls)... never happened
TWTR, AMZN, NFLX --> all alredy up, and BIDU.

All of them are up today, except BIDU is down because of this news
China’s ‘Search Dog’ Said to Plan IPO at $3 Billion Value

BIDU around $214 now... looking to buy 215 calls for under $0.30 if it dips again, I maybe missed the best opp... 217.50 might be to far, or a fantastic lotto ticket
Hope is dangerous in this game.
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