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Let's Trade Options

  • #10,661
  • Sep 15, 2015 8:57am Sep 15, 2015 8:57am
Quoting ZebraSquirl
{quote} Rolling a few "too close for comfort" credit spread setups with this week's expiry out of harm's way ... . Otherwise, hand-sitting ... .
Would be totally fine with a massive whipsaw to both sides with FOMC, with the possible exception of FXE, where the setups are all short, in which case, I'll just take a whipsaw to the downside, thank you very much ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,662
  • Sep 15, 2015 9:14am Sep 15, 2015 9:14am
Tell ya one thing, Dough's Katie's working those futures like a madwoman ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,663
  • Sep 15, 2015 10:38am Sep 15, 2015 10:38am
http://news.yahoo.com/emerging-econo...--finance.html

"What is surprising is how many central bankers with whom I talk prefer the hike to come as soon as possible," Valarde said, arguing that the uncertainty of the wait was more damaging than the interest rate increase itself.

Indian central bank governor Raghuram Rajan agreed. "It's preferable to have a move early on and an advertised, slow move up rather than the Fed be forced to tighten more significantly down the line," he told the Wall Street Journal at the Jackson Hole, Wyoming, central bankers' meeting last month.

For Indonesia's central bank, too, the doubts are of the greatest concern. "We think US monetary policymakers have got confused about what to do. The uncertainty has created the turmoil," Mirza Adityaswara, deputy governor at Indonesia's central bank, told the Financial Times. "The situation will recover the sooner the Fed makes a decision and then gives expectation to the market that they increase one or two times and then stop," he said. ....."

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"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,664
  • Sep 15, 2015 4:06pm Sep 15, 2015 4:06pm
Quoting ZebraSquirl
{quote} Rolling a few "too close for comfort" credit spread setups with this week's expiry out of harm's way ... . Otherwise, hand-sitting ... .
Swept those under the rug ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,665
  • Sep 15, 2015 4:09pm Sep 15, 2015 4:09pm
I have watched my nice VXX positions bleed out this week, with the ^VIX diving....the rate hike panic was in August, hell they might raise and the markets rally .... I will hang in though.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,666
  • Sep 15, 2015 6:40pm Sep 15, 2015 6:40pm
risk 4c to net max 30c in 10 days, not bad - if the Fed holds off you might expect to see UST's rally
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-09-15_tlt.png Size: 60 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,667
  • Sep 16, 2015 7:16am Sep 16, 2015 7:16am
still stuck in the dead zone, need a big move to close the week. Liftoff would do it - I still believe....the Great Pumpkin will come, you'll see.....
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-09-16_0713SS.png Size: 70 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,668
  • Sep 16, 2015 9:20am Sep 16, 2015 9:20am
Quoting StrayDog
/ES -> All this coiling makes condition for a massive move after FOMC. A relief rally + short squeeze, OR a nice bear party. I am thinking about cheap Reverse Iron Condor on /ES, using Sep expiry. Possible entry on Wednesday, both parts, i.e. both debit spreads entered separately. Maybe do the same with some other expiry, OR do just one side, if I feel confident, after the initial move.
Well, I was thinking that the big boys are going to hold SPX around 1950 until FOMC...
Obviously that was not the case. SPX is a few points bellow it first key resistance at 1993...

SPX 60m chart
Attached Image (click to enlarge)
Click to Enlarge Name: SPX-60m-key-resistance.PNG Size: 157 KB


Above that, only other resistance comes at ~2040, i.e. the bottom of the well known channel / multi-month consolidation.

So, working idea is this -> with Sep /ES around 1989, I am looking at these $5 wide debit spreads:
/ES Sep 2020/2025 call spread for $1.10 debit
/ES Sep 1950/1945 put spread for $0.85 debit

I would like to get in to both spreads for a combine expense of up to $1.50, because obviously one of those are going to expire worthless. Maybe even both of them.
Hope is dangerous in this game.
  • #10,669
  • Sep 16, 2015 9:30am Sep 16, 2015 9:30am
Quoting StrayDog
obviously one of those are going to expire worthless. Maybe even both of them.
yeah, my fear is that FOMC gonna be a big fizzle.....but I think there will be a big move.....I still believe...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,670
  • Sep 16, 2015 9:34am Sep 16, 2015 9:34am
Looking strictly technically... these types of ascending triangles, on pretty much all indices, tend to break to the upside.

DJIA 240m chart (CFD data)
Attached Image (click to enlarge)
Click to Enlarge Name: DJIA-240m-CFD.PNG Size: 113 KB


If not for a FOMC tomorrow... struggle is right there on the line now. Breaking this will absolutely cause another short covering rally. Looking like it is going to break.
Hope is dangerous in this game.
  • #10,671
  • Sep 16, 2015 9:50am Sep 16, 2015 9:50am
if we break above /ES 2030 or so I will make decent money, will make decent money on a VXX crash back down to $20 or below.......just not as much as for a steep panic slide....I would have to get monster moves in either direction to actually lose money. Looking forward to forgetting about the fomc, anyway ...moving on to the next bfd
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,672
  • Sep 16, 2015 10:00am Sep 16, 2015 10:00am
Quoting The Fool
if we break above /ES 2030 or so I will make decent money, will make decent money on a VXX crash back down to $20 or below.......just not as much as for a steep panic slide....I would have to get monster moves in either direction to actually lose money. Looking forward to forgetting about the fomc, anyway ...moving on to the next bfd
I would like to see a retest of the 1830 low on /ES, or lower low... or higher low at lets say 1850... whatever, all that gives high VIX, high volatility and much more opportunities than breaking to the upside. (And going back to the boring channel.) Just saying... Market off course doesn't give a f***ck what I wish.
Hope is dangerous in this game.
  • #10,673
  • Sep 16, 2015 10:41am Sep 16, 2015 10:41am
Quoting StrayDog
{quote} I would like to see a retest of the 1830 low on /ES, or lower low... or higher low at lets say 1850... whatever, all that gives high VIX, high volatility and much more opportunities
oh yes.....I have done a few little side bets on a SPY drop with weekly puts....prolly shoulda just kept sitting on hands
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,674
  • Sep 16, 2015 11:16am Sep 16, 2015 11:16am
equity rally pre-FOMC smells fishy.....like a bull trap
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,675
  • Sep 16, 2015 11:33am Sep 16, 2015 11:33am
Quoting The Fool
equity rally pre-FOMC smells fishy.....like a bull trap
Yep. All that trying to have a breakout before FOMC... On SPX failed so far. In any other situation I would try to short this on the very line, but not today, I will just wait. When I look at futures charts, everyone except /ES managed to put their head above that resistance, and failed, no follow-trough. Well... could be bull trap for today. On those debit spreads... I didn't entered anything yet. I could make position tomorrow also, maybe in pre-market.
Hope is dangerous in this game.
  • #10,676
  • Sep 16, 2015 12:07pm Sep 16, 2015 12:07pm
And yet another attempt to make a pre-FOMC breakout...

This is interesting... /ES futures options vs. SPY options, both regular Sep monthlies.

Attached Image


Attached Image


Difference in expiry time... SPY options expires after RTH, but futures options expiry is in the morning, before open.

And there goes THE WTF MOMENT:
Same strike on /ES futures options, but October expiry.
Attached Image

So, really WTF?



Addon:
Obviously I had a very bad coffee today... YO STRAYDOG -> FUTURES CONTRACT EXPIRY.... on Friday, options must expire BEFORE u/l...
Hope is dangerous in this game.
  • #10,677
  • Sep 16, 2015 12:23pm Sep 16, 2015 12:23pm
SPY rally to $200 cooks my goose if the FOMC hikes. I need sub $190 to make money on positions expiring Friday, asking a lot........now I'll be better off with a no-show and a rally continuation to close the week.......aw nuts
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,678
  • Sep 16, 2015 6:25pm Sep 16, 2015 6:25pm
Trying not to watch things too much, except to get a general sense of market movement. It would otherwise drive me bonkers ... . As usual, before this up move, I was all hot and bothered about my index ETF short put sides, some of which were taken off at 50% max with the up-move; all the TLT call sides, gone ... . Had to steel myself not to add sides back in for the experies that were 25 DTE + and opt instead to wait until after FOMC.

I was frankly surprised that the market seems absolutely positive that there will be no hike this go-round; there is no other explanation for this up-move, unless it's just raw short covering by folks who were too late to move to the sidelines ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,679
  • Sep 16, 2015 6:28pm Sep 16, 2015 6:28pm
Quoting StrayDog
And yet another attempt to make a pre-FOMC breakout... This is interesting... /ES futures options vs. SPY options, both regular Sep monthlies. {image} {image} Difference in expiry time... SPY options expires after RTH, but futures options expiry is in the morning, before open. And there goes THE WTF MOMENT: Same strike on /ES futures options, but October expiry. {image} So, really WTF? Addon: Obviously I had a very bad coffee today... YO STRAYDOG -> FUTURES CONTRACT EXPIRY.... on Friday, options must expire BEFORE u/l...
This is probably why I haven't dipped my toe into futures yet ... . I'd be scratching my head ... a lot ("What, you mean December /ES futures expire in October?").
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,680
  • Sep 16, 2015 6:40pm Sep 16, 2015 6:40pm
I frankly don't know why I read this crap, but I do ... . http://www.cnbc.com/2015/09/16/why-t...jim-grant.html

I've read just as much to the other side about the Fed's "third mandate" (the global economy/the strengthening Greenback) and why the Fed won't raise rates until 2016, blah blah blah ... .

I am 100% sure about one thing: the Fed will either raise rates ... or they won't ... . Personally, I'm expecting that token .125%, so Janet can say, "Here's a little taste ... ."

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Fireworks are fun ... as long as you don't blow your fingers off.
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