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Let's Trade Options

  • #8,421
  • Apr 28, 2015 1:28pm Apr 28, 2015 1:28pm
I don't see no bubbles...

http://www.bullfax.com/?q=node-wtf-c...trading-accoun
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,422
  • Apr 28, 2015 2:15pm Apr 28, 2015 2:15pm
Quoting StrayDog
I closed my SPY bearish call spreads with minimal loss (in for $0.62, out for $0.67), since the price was rejected from support... all this shit was just another BTFD opportunity. And I don't want to risk hopium on dovish FOMC. Call me a pussy, but I don't care . All this looks like a bear trap to me..
yup, I'm hanging in, also have May $214/$215 calls. You are probably much wiser than me. But I am, after all, the Fool. The bears are definitely weak but the bulls are not really all that, either. The spooz been m/l ranging all Winter/Spring. SPY up $2.50 from its finish 12/29/14, woohoo. Another super dovish Fed show should do the trick, though, and I am preparing to eat shit. Sell in May Go Away my last hope, that and rotation into China and the Ezone, we'll see....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,423
  • Apr 28, 2015 2:34pm Apr 28, 2015 2:34pm
Hey TF!

Idk, about that SPY trade - it was positive only once, briefly... I had 2 spreads for $0.60 credit and after I sold another for $0.65... So 3 in total. Then I closed one a few days ago when mofo was positive... and remaining 2 today. All combined is small loss, like ten bucks.

I don't like trades where you are most of the time negative... and on top of that, had a nice loser on AMZN. So, after 2 good (and short) trades of selling Oil premium (probably I should hold them longer, but wtf) and nice winner on AAPL, I just didn't want to risk 3 good trades to maybe lose on this shit. So, my account looking a bit better, and I have only one position left, call calendars on USO.

Will trade less, trying to pick targets a bit wiser than before. Sell premium on Oil again. Scalp DAX. Looking to do some ER' trades for today --> look at TWTR, data leaked... But idk, I hesitate to pull the trigger on WDC or AKAM. I don't like X, that thing can move 10%+ easy. Since I don't know anything about all of them, I can go only non-directional, like Iron Condors or Short Strangles. Probably will skip all of them.
Hope is dangerous in this game.
  • #8,424
  • Apr 28, 2015 2:41pm Apr 28, 2015 2:41pm
And they did it again...
VIX is bellow $13...
If you sell premium, it is thin. If you go directionally, there is no move. The picture of the market now.
Keeping my profits, that's what I am gonna do. Sitting in ambush, waiting for a crippled little pig to kill. Lost, without momma to defend it.
Ain't gonna chase those speedy cocky gazelles, that's for sure.
Hope is dangerous in this game.
  • #8,425
  • Apr 28, 2015 2:55pm Apr 28, 2015 2:55pm
TWTR??? WTF?
It was down 20%... panic sales... prolly weak guidance... well, I don't give a shit, so why should I care?
Hope is dangerous in this game.
  • #8,426
  • Apr 28, 2015 3:06pm Apr 28, 2015 3:06pm
Quoting StrayDog
Will trade less, trying to pick targets a bit wiser than before.
Yep, I'd be better off if I just sat on hands mostly last couple months. I almost traded an IC on TWTR, decided not to - I just don't have time to follow the individual names so much now. Woulda got smacked if I'd been in....

Idk what it will take for vol to come back, maybe Fed will follow thru and raise the ffr this year. Maybe will be something unexpected...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,427
  • Apr 28, 2015 5:25pm Apr 28, 2015 5:25pm
Quoting StrayDog
{quote} Hi ZS... TF replied to your question, I just want to say that pretty much all selling premium plays have a negative risk/reward. Starting from credit spreads, and then to naked selling. Usually hard core premium sellers (like tastytrade crew) sell junk, meaning the most further OTM spreads or single options they can to get meaningful premium. They usually play for 1/3 of the width of the strikes, when credit spreads are traded. But, big thing is IV and IVR... the greater the IVR, you can go further OTM and thus decrease your risk. High IV...
Thanks tons, guys ... . I kinda figured as much (with respect to taking advantage of Theta decay and such) ... . The TastyTrade crew does seem to dance around a lot managing f'd up trades, which I'd naturally prefer not to do. The other thing I kind of part ways with them is getting in "number of occurrences." I understand where they're coming from; the more high prob trades you put on, the greater the probability of your overall success, but I'd rather do a fairly manageable number of fairly high quality trades without going bonkers juggling a bunch of f'd up balls that you have to roll and manipulate the heck out of to come out of net profitable (some of the ways they work out of the screwed up trades in "Anatomy of a Trade" is quite amazing, frankly, but not my cup of tea unless I have to absolutely do it; there are more chances to screw up doing things that way ... ).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #8,428
  • Apr 28, 2015 5:41pm Apr 28, 2015 5:41pm
Quoting The Fool
{quote} the further out the options are, the less theta is for the options. I have shown Greeks for the Jun puts for the spread shown, and same for the May2 puts, for comparison. Theta gets larger the closer you are to expiry, and this accounts for the steepening of the theta decay curve with time. Also note that theta is higher the closer the option is to atm. So, if you have a lot of value on an option and a lot of time for that theta to work, you may make money on decay alone, assuming the u/l doesn't move. On the flip side, the more time you...
... and that's the additional thing about this particular trade ... . Bullish on fiber/FXE to stay above 104.3 with, like 50 odd days until expiration ... .

A lot crap can happen in that time frame (Grexit would have been in the back of my mind for one) ... . Trade's lookin' good -- for now ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #8,429
  • Apr 28, 2015 6:41pm Apr 28, 2015 6:41pm
@ZS, I have made this comment b4, and it is cynical enough, but also m/l true: tt and Dough people are TDA people. "Trade small, trade often" may be good advice (if you're a good trader) but it's also music to the dealer's ears....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,430
  • Apr 28, 2015 7:20pm Apr 28, 2015 7:20pm
There were a lot of misses in ER's after hrs today - TWTR, WYNN, BWLD, PNRA, etc - so maybe the SnP will trend down for tomorrow - just in time for Sheriff Grandma Yellen to ride into town on a big white bunny and sprinkle fairy dust on all good bots and traders.....oh boy!
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,431
  • Apr 28, 2015 7:21pm Apr 28, 2015 7:21pm
Quoting The Fool
@ZS, I have made this comment b4, and it is cynical enough, but also m/l true: tt and Dough people are TDA people. "Trade small, trade often" may be good advice (if you're a good trader) but it's also music to the dealer's ears....
check TLT daily TF looks as though it may drop hard tomorrow on FOMC
  • #8,432
  • Apr 28, 2015 7:31pm Apr 28, 2015 7:31pm
Quoting Cecil Gee
{quote} check TLT daily TF looks as though it may drop hard tomorrow on FOMC
Hey CG,

maybe, ...I tried for many moons to short that booger and just when I gave up, it started to slide. Typical TF luck.

So, outflows from TLT = ouflows from the UST long bond, which means the bond market takes seriously the prospect of a ffr hike...OR, the equity markets are just so bullish that bond traders would rather seek higher yields in stocks...OR,...who knows?

With fixed income yields so low elsewhere and with everyone not really believing the Fed has it in them to actually hike, I am surprised to see long bonds slipping...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,433
  • Apr 28, 2015 7:47pm Apr 28, 2015 7:47pm
Quoting The Fool
{quote} Hey CG, maybe, ...I tried for many moons to short that booger and just when I gave up, it started to slide. Typical TF luck. So, outflows from TLT = ouflows from the UST long bond, which means the bond market takes seriously the prospect of a ffr hike...OR, the equity markets are just so bullish that bond traders would rather seek higher yields in stocks...OR,...who knows? With fixed income yields so low elsewhere and with everyone not really believing the Fed has it in them to actually hike, I am surprised to see long bonds slipping...
The Dollar cash settled index charts looks as though it supports some definitive wording on a hike, we still haven't traded outside the last FOMC WHIPSAW CANDLE
  • #8,434
  • Apr 28, 2015 11:15pm Apr 28, 2015 11:15pm
Quoting The Fool
@ZS, I have made this comment b4, and it is cynical enough, but also m/l true: tt and Dough people are TDA people. "Trade small, trade often" may be good advice (if you're a good trader) but it's also music to the dealer's ears....
I take the TastyTrade guys' stuff with a grain of salt ... ; with anything, I try to take away what I can use/throw the rest of the crap away. After watching quite a few of the shows, it sometimes seems like Tom needs to trade constantly ... . Cynical view: he needs to put on trades for the show; no trades = boring show. It's like watching Jim Cramer; entertaining, but not my style of trading ... .

I did set up a paper trade TOS account just to familiarize myself with the platform (hate to make mistakes just because I'm unfamiliar ...), putting on a handful of high prob strangles just to get a few trades on that I can manage (assuming they fill).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #8,435
  • Apr 29, 2015 12:08am Apr 29, 2015 12:08am
exactly, they're getting paid to trade - in more ways than one. But TOS is excellent...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,436
  • Apr 29, 2015 12:23am Apr 29, 2015 12:23am
Quoting Cecil Gee
we still haven't traded outside the last FOMC WHIPSAW CANDLE
yeah that was a doozy, 50 pt range on the SnP....I am looking at cheap debit spreads in hopes of a similar move....puts below is May1 $209/$208.5 for $0.05...
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-04-28_spy.png Size: 42 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,437
  • Apr 29, 2015 9:35am Apr 29, 2015 9:35am
should see /CL make a run on $60 in early May if this weak USD maintains. We'll see what kind of noise the Fed brings. Even a whiff of hawk there should keep pressure on US equities. Cecil, you were right about TLT - good call.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,438
  • Apr 29, 2015 10:13am Apr 29, 2015 10:13am
Quoting The Fool
... "Trade small, trade often" may be good advice (if you're a good trader) but it's also music to the dealer's ears....
Exactly. Trade small --> that first part is the best advice you can get, IMO... but the second part is not, especially in non-directional environment. Let the trade come to you. Chasing number of occurrences can backfire on you.
Hope is dangerous in this game.
  • #8,439
  • Apr 29, 2015 10:14am Apr 29, 2015 10:14am
Quoting The Fool
So, outflows from TLT = ouflows from the UST long bond, which means the bond market takes seriously the prospect of a ffr hike...OR, the equity markets are just so bullish that bond traders would rather seek higher yields in stocks...OR,...who knows? With fixed income yields so low elsewhere and with everyone not really believing the Fed has it in them to actually hike, I am surprised to see long bonds slipping...
I am shopping TLT long call diagonals out to Jun, if I can get in near $0 out around $135
"If The Fool persists in his Folly he will become wise." - William Blake
  • #8,440
  • Apr 29, 2015 10:23am Apr 29, 2015 10:23am
Quoting The Fool
should see /CL make a run on $60 in early May if this weak USD maintains. We'll see what kind of noise the Fed brings. Even a whiff of hawk there should keep pressure on US equities. Cecil, you were right about TLT - good call.
/CL now looks like breakout above $58 is coming... I closed that put too early (now it would be a 50% winner, but I can live with 33% I took)... no dip in sight. I didn't like daily chart, but this consolidation is more like to breakout than pullback.

Almost a 500 points daily range on DAX today... EUR on steroids, punishing PA on DAX... I imagine like 30 points slippages on sell stops.
Freddy Krueger market off course doesn't give a shit, expecting another round of punch and cookies.
Hope is dangerous in this game.
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