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Let's Trade Options

  • #10,801
  • Sep 23, 2015 3:22pm Sep 23, 2015 3:22pm
Quoting The Fool
{quote} choppy, volatile ranges punctuated by "level jumping" bigass 1-2 day moves, like a couple 80 pt candles in a row, or better. I am afraid to position in this pa with condors, because those big jumps are murder, if they come. Otoh, the iv never has a chance to blow off with all the chop, so if you want to try to put on some verticals to try to waylay one of those pops, you have to be willing to pay a little more for it ...obviously, though, it's better to have some movement if the fish are jumping hey maybe some will just land in your boat...
I've been taking off the wings of the IC's at 50% max in this chop, rather than shooting for taking off the whole thing ... . If you aren't going to get a crush in the volatility, might as well take advantage of the movement to lock in gains on one side or the other of the equation ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,802
  • Sep 23, 2015 3:32pm Sep 23, 2015 3:32pm
Quoting StrayDog
Lets be prepared for a very possible scenario -> testing the Aug lows. SPX INDEX daily chart {image} False breakout (on FOMC) from ascending triangle, followed by breakdown. For this scenario, if we see a double bottom, I have following simple ideas -> sell put spreads, and sell volatility. The later I will probably do a combination of buying XIV and put spreads on VXX. Even if we see just a bounce, and after that a lower low, this could be very nice on high vol. Addon Mind that the chart above is cash index. Aug /ES low around 1830, and Oct 2014...
Keeping quite a bit of powder dry for that high vol breakdown scenario ... . Unfortunately, uber high volatility can be quite fleeting. Hate to have a lot of cash on the sidelines, but it's the nature of the beast ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,803
  • Sep 23, 2015 3:42pm Sep 23, 2015 3:42pm
Actually found a fairly decent trade on Dough while I was watching the markets basically go nowhere slowly -- OIH. I didn't do the setup exactly as Robyn did (short strangle), opting instead for an iron condor because I didn't want to tie up the buying power. As a tradeoff, I went bigger contract-wise. Those low priced underlyings are simply a bitch to get juice out of unless you caffeinate the number of contracts in a defined risk setup ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,804
  • Sep 23, 2015 3:48pm Sep 23, 2015 3:48pm
Quoting rbfx
I guess US operators are a bit behind on that front.
well, it's a big country & parts of it have very low population - throw in lots of mountains and it doesn't make much sense to develop the wireless infrastructure in some places...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,805
  • Edited 4:54pm Sep 23, 2015 3:56pm | Edited 4:54pm
I tried to fill a weekly VXX $23/$22.50 bear puts vert for 12c and missed I think by 2c. I am looking for bullish action in US equities....maybe not bullish per se, but a pullback to SPY $196+ by Friday, anyway. The charts say what they say and any number of plausible bearish arguments can be made, but I have had my nuts caught in too many V-bottoms to be a believer just yet....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,806
  • Sep 23, 2015 5:08pm Sep 23, 2015 5:08pm
UNG......about to break $12? I prolly won't live long enough to see the natgas bull revive.....knock on wood
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,807
  • Sep 23, 2015 10:41pm Sep 23, 2015 10:41pm
last couple weeks have been kind of a snooze, except for the FOMC dump, but the real story still is that late Aug China scare, still echoing through the charts of indices and individual equity names & keeping IVR's up, but that is receding in the rear view....
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-09-23_qqq.png Size: 82 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,808
  • Sep 23, 2015 10:47pm Sep 23, 2015 10:47pm
PBR barely managed to close above $4 today, a new all-time low. WTF, Brazil? PBR traded up to $20 just a few weeks over one year ago....
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-09-23_2PBR.png Size: 110 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,809
  • Sep 23, 2015 11:56pm Sep 23, 2015 11:56pm
Quoting The Fool
UNG......about to break $12? I prolly won't live long enough to see the natgas bull revive.....knock on wood
Blows ... . Will contemplate adding something if 12 gives way ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,810
  • Sep 24, 2015 6:39am Sep 24, 2015 6:39am
So when are we buying VW calls? and how
  • #10,811
  • Sep 24, 2015 11:32am Sep 24, 2015 11:32am
Quoting ZebraSquirl
I don't fully understand this Dough Trade (he says facetiously) ... . Nick put on a Nov 20th SPY 163/178/201/217 IC for a 3.74 credit. You read that right: basically 15 strikes wide on the put wing, 16 on the call. Good luck managing that ginormous cluster when one of those sides is tested ... .
Okay ... . Now I get this trade ... . It's a "dynamic iron condor." Basically what he's going to do there is manage the short call and puts like a short strangle over the life of the setup and leave the long call and put where they're at ... . Naturally, if price stays between his short strikes, I imagine he'll do nothing, but take it off at 50% max. If price tests one of his short legs, he'll roll the untested short leg only, leaving the long in place (assuming there's still some value in it; otherwise, he'll roll that too). Not sure that this is worthwhile to tie up that much buying power ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,812
  • Sep 24, 2015 11:32am Sep 24, 2015 11:32am
Quoting The Fool
I will match the calls diag with puts down under $185 if SPY will pull back. Puts are skewed higher, need them to blow off some iv to get in a $1 time spread as cheap as the calls....
waiting....nothing much new, just as well as my bullish bias for equities has been wrong. Overloaded elsewhere in life.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,813
  • Sep 24, 2015 11:34am Sep 24, 2015 11:34am
Quoting ZebraSquirl
Not sure that this is worthwhile to tie up that much buying power ... .
I don't like it.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,814
  • Sep 24, 2015 12:22pm Sep 24, 2015 12:22pm
Quoting ZebraSquirl
Not sure that this is worthwhile to tie up that much buying power ... .
No. Dislike.
I trade occasionally /ES options, 20-30 points wide spreads for selling, and if I wanna go loco and buy, then just 5-10 points wide.... this is just too wide.

Totally out of sync today, scalped a bit, nothing much...
Hope is dangerous in this game.
  • #10,815
  • Sep 24, 2015 12:29pm Sep 24, 2015 12:29pm
Quoting The Fool
{quote} izzat pretty common there in Belgrade? The internet nearly never goes down where I live, but power does, several times a year for 12-36 hrs, so I have backup power ...
No, it isn't. I have lost internet maybe 3-5 times in past couple of years. We had a power cut a few days ago, half of Belgrade lost power for one hour. Off course, that was between 15h and 16h. (NYSE opens at 15:30h my time). But power cuts are also very, very rare here. I have UPS just in case, sometimes power is lost just for a few seconds, and then having a UPS is a wonderful thing.

Quoting rbfx
{quote} Having a cellular broadband connection as a backup is worth every penny if you're an active trader. Moreover, it's more secure than public WLANs when you're on the move with your laptop.
Hey rbfx... yeah, you got that right. You can always close position from your phone, and I have 300Mb of free internet... I just prefer trading from desktop. When I first take a look at mobile app -> my first reaction was a gigantic WTF! But, in reality, i should take a closer look at it.
Hope is dangerous in this game.
  • #10,816
  • Sep 24, 2015 12:53pm Sep 24, 2015 12:53pm
Quoting StrayDog
{quote} No. Dislike. I trade occasionally /ES options, 20-30 points wide spreads for selling, and if I wanna go loco and buy, then just 5-10 points wide.... this is just too wide. Totally out of sync today, scalped a bit, nothing much...
Too funky a setup for my tastes ... . Stick to the standard setups ... .

I've resorted to the Dough grid for trading ideas (kind of a sad state of affairs, really). With IVR at 70, trying to get a fill on an EDZ Nov 6th 15/17/24.5/26.5 iron condor for a .43 credit ... . Not terribly excited about it, but some of the index ETF weeklies remain jacked up on the put side of things. Just don't feel like going 5-wide on the short put spreads ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,817
  • Sep 24, 2015 12:56pm Sep 24, 2015 12:56pm
Quoting ZebraSquirl
{quote} Too funky a setup for my tastes ... . Stick to the standard setups ... . I've resorted to the Dough grid for trading ideas (kind of a sad state of affairs, really). With IVR at 70, trying to get a fill on an EDZ Nov 6th 15/17/24.5/26.5 iron condor for a .43 credit ... . Not terribly excited about it, but some of the index ETF weeklies remain jacked up on the put side of things. Just don't feel like going 5-wide on the short put spreads ... .
Also, plain ass passing on earnings plays ... . Just don't feel like they're worth the headache ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #10,818
  • Sep 24, 2015 1:20pm Sep 24, 2015 1:20pm
Watching Shadow Trader... check out this SPY June puts

Attached Image (click to enlarge)
Click to Enlarge Name: SPY-june-puts.PNG Size: 663 KB


Since OI is small, this is new trades... I guess that is 182/185 put spreads, but sold or bought?
Hope is dangerous in this game.
  • #10,819
  • Sep 24, 2015 1:22pm Sep 24, 2015 1:22pm
Quoting ZebraSquirl
Also, plain ass passing on earnings plays .......
need the IVR's to fall way off - ER trades all about catching an iv run-up and subsequent dump, can't happen (so well) if iv is already done runned up
"If The Fool persists in his Folly he will become wise." - William Blake
  • #10,820
  • Sep 24, 2015 1:25pm Sep 24, 2015 1:25pm
Quoting StrayDog
Hey rbfx... yeah, you got that right. You can always close position from your phone, and I have 300Mb of free internet... I just prefer trading from desktop. When I first take a look at mobile app -> my first reaction was a gigantic WTF! But, in reality, i should take a closer look at it.
I know what you mean. Being able to observe the market with 2+ monitors (with access to all the relevant instruments) will often give you a very different view of what it's up to.
Twitter: ThirdMoment
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