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Let's Trade Options

  • #11,181
  • Nov 11, 2015 11:34am Nov 11, 2015 11:34am
I need somebody to slap me, I guess - I think the UVXY spike could be trapped, as shown above, Of course, it may not occur, and that's fine, bait another hook.....but my main concern is getting filled on the massive upside sell orders.

....anyway, this week was primed for a doji or a little red candle, we'll see what next week does, Santa rally possibility by no means in trouble....yet. But we need some movement on SPY DD's or they will wither in the dead zone of the P/L.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,182
  • Nov 11, 2015 1:34pm Nov 11, 2015 1:34pm
Quoting The Fool
filled the UVXY bfly just above for 30c
trying to fill Jan $40/50/60 for 15c - which I saw - but they want >30c now, will wait....the $45/55/65 I got for 30c went to 60c briefly, ....they jump around...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,183
  • Nov 11, 2015 2:24pm Nov 11, 2015 2:24pm
filled Dec/Dec4 VXX $26 calls for 7c....all vol, all the time....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,184
  • Nov 11, 2015 9:06pm Nov 11, 2015 9:06pm
Quoting The Fool
{quote} big light bulb right there - if you are timing trades around scheduled events, and you give yourself plenty o time before the event, you can set the front short leg of the time spread to expire the week before or week of the event.....so, the big event draws nigh, the front option expires worthless, and the back longs are set up to go deep itm. That is exactly what I have done with the VXX calendars above: Dec FOMC is 12/16 & Dec opex is 12/18. There are 2 scenarios I am fishing for: 1) The vix catches fire in the run-up to the Dec FOMC...
I'm warming up to these mightily, especially with these nickel and dime earnings plays dwindling. Should have tried for some fills today when I could play with UVXY; now I'm half in the bag ... . Lol. I'll shoot for some next Tuesday ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,185
  • Nov 11, 2015 10:10pm Nov 11, 2015 10:10pm
Gonna try to be somewhat mechanical with this VIX product/FOMC play. Since I can't be around to watch it during the day job, I'm just going to set a VIX Dec 16th/Jan 20th 25 call spread (which is around the 2 SD), look for a fill for a .10 debit and then GTC it for a couple weeks and see what happens. In all likelihood, I won't get filled at that price, but it'll help me to monitor where price is at and adjust the strikes and/or price. Hopefully I'll be able to get in cheap if we get a volatility dip somewhere in the next couple of weeks (the mid's at .53 now, and I ain't payin' that).

Were I to get filled at .10 (which ain't gonna happen, but we can dream): max profit $35.20; BPE $1.00; POP% 78%; BE's: 13.01/50.00. Ree donk ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,186
  • Nov 11, 2015 11:17pm Nov 11, 2015 11:17pm
Quoting ZebraSquirl
Gonna try to be somewhat mechanical with this VIX product/FOMC play..
...one thought on these vix spike setups: the premise is we grind along, probably see the indices melt up into Dec, and then the Fed hikes at the Dec FOMC, and viola, tshtf.

...well, maybe won't play that way, maybe we see vix run up b4 the meeting, with a big anticlimax after.....maybe we see no big vix spike at all....anyway, I am not betting the farm....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,187
  • Nov 11, 2015 11:28pm Nov 11, 2015 11:28pm
to catch a nearer term vix run-up, the Dec/Dec4 50c diagonals can be had for pennies - the one below b/e's out at the Aug $30-$31 spike limit
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-11-11_2124vxx.png Size: 82 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,188
  • Nov 11, 2015 11:43pm Nov 11, 2015 11:43pm
easier to fill these spreads with VXX, which is much more liquid than UVXY
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-11-11_vxxfly.png Size: 92 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,189
  • Nov 11, 2015 11:52pm Nov 11, 2015 11:52pm
insurance against an overshoot past fly upside b/e - bring the high wing in, as in Dec4 $23/27/30 below
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-11-11_vxxbwf.png Size: 104 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,190
  • Nov 12, 2015 4:07am Nov 12, 2015 4:07am
hi all been a while, making a lot less trades but focusing on better quality of trades which means longer waits for the set ups, currently I'm looking to take a 6 week strangle on DAL delta airline price is just under $50 so a single strike either side should cost just under $2 and looking for a $4 move in this stock in the next few weeks
  • #11,191
  • Nov 12, 2015 9:15am Nov 12, 2015 9:15am
Quoting Cecil Gee
hi all been a while, making a lot less trades but focusing on better quality of trades which means longer waits for the set ups, currently I'm looking to take a 6 week strangle on DAL delta airline price is just under $50 so a single strike either side should cost just under $2 and looking for a $4 move in this stock in the next few weeks
Hi Cecil, hope you have been well....I have been happy with trading results, but volume has been low this Fall, trying to finish the year strong....6 weeks til Christmas Eve, 7 weeks til New Years....I expect we will see some big moves in lots of things in that window.....Happy Trades.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,192
  • Nov 12, 2015 12:09pm Nov 12, 2015 12:09pm
Quoting The Fool
Hi Cecil, hope you have been well....I have been happy with trading results, but volume has been low this Fall, trying to finish the year strong....
Hi CG, TF...

I am not so happy with my trading results. Although generally positive, I finished October with a small loss. My trading volume is also thin... very thin these days, with some personal and work issues. Today and yesterday was good trading days, some opportunities was easy for me to spot, but didn't have the time or got distracted to take a full advantage of them. I made some money, but... This shit is hard, no doubt about that. Options trading very thin, maybe 5 per month only, with only one or two index scalps per day (CFDs). I gave up on futures trading, since it is more practical for me to trade via CFDs, wich are much smaller, and money management is easier (to add to position, or partially bank). As TF said once - "you have to deserve the right to trade big", and until then, I am building my confidence.

I picked up a good idea from Shadow Trader, regarding ER's plays. Their favorite play is AFTER the big ER's miss, when stock is tanking right into some good technical support. Then, you imediatelly after the open, watching the PA of course, but soon after the open, while the juice is still in there, sell naked puts or put spreads in front of a bounce. For example, that could have been done on CMG, with selling puts right under 600, like weekly 595/590, or with expiry for one more week, like 8-9 DTE... or PCLN with selling something under 1,300... The premise is to catch a bounce, while vol is still there...
Hope is dangerous in this game.
  • #11,193
  • Nov 12, 2015 5:54pm Nov 12, 2015 5:54pm
Quoting ZebraSquirl
Gonna try to be somewhat mechanical with this VIX product/FOMC play. Since I can't be around to watch it during the day job, I'm just going to set a VIX Dec 16th/Jan 20th 25 call spread (which is around the 2 SD), look for a fill for a .10 debit and then GTC it for a couple weeks and see what happens. In all likelihood, I won't get filled at that price, but it'll help me to monitor where price is at and adjust the strikes and/or price. Hopefully I'll be able to get in cheap if we get a volatility dip somewhere in the next couple of weeks (the mid's...
With today's price action, I may have missed the VIX train leaving the station, at least for the moment.

One thing about VIX: it's somewhat unwieldy in the sense that the expirations aren't that flexible, but the floor is a lot cleaner to work with than VXX or UVXY. UVXY requires patience; it's best just to set it up for a price at which you're willing to play and then not chase ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,194
  • Nov 12, 2015 5:57pm Nov 12, 2015 5:57pm
Quoting StrayDog
{quote} Hi CG, TF... I am not so happy with my trading results. Although generally positive, I finished October with a small loss. My trading volume is also thin... very thin these days, with some personal and work issues. Today and yesterday was good trading days, some opportunities was easy for me to spot, but didn't have the time or got distracted to take a full advantage of them. I made some money, but... This shit is hard, no doubt about that. Options trading very thin, maybe 5 per month only, with only one or two index scalps per day (CFDs)....
I've played quite a few earnings this way ... . You sometimes get a higher volatility pop post-earnings for various reasons than before, so it's worth keeping an eye on even though earnings have passed ... . But I've been playing those the standard way -- short strangle, 45 DTE, but I like the Shadow Trader idea too if you can be around at market open and watch what price does after earnings.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,195
  • Nov 12, 2015 8:47pm Nov 12, 2015 8:47pm
couple SPY DD's I have running into next week's expiry, I will do well if SPY will keep sliding to $200 and below....as usual, the wider strikes on the spreads give a more forgiving P/L
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 2015-11-12_SPY1.png Size: 91 KB
Click to Enlarge Name: 2015-11-12_SPY2.png Size: 88 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,196
  • Nov 12, 2015 8:52pm Nov 12, 2015 8:52pm
Quoting ZebraSquirl
{quote} With today's price action, I may have missed the VIX train leaving the station, ... .
watch for a pullback, but I like the idea of ^VIX starting to lay in a base for a massive peak into the end of the year....I thought we would see something of a Santa rally, but it is turning out to be a tough swim against the tide of the commods rout
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,197
  • Nov 12, 2015 9:00pm Nov 12, 2015 9:00pm
Quoting StrayDog
I picked up a good idea from Shadow Trader, regarding ER's plays. Their favorite play is AFTER the big ER's miss, when stock is tanking right into some good technical support. Then, you imediatelly after the open, watching the PA of course, but soon after the open, while the juice is still in there, sell naked puts or put spreads in front of a bounce.... The premise is to catch a bounce, while vol is still there...
....case by case, I'd say, with the best cases the strong names that get sunk even when their ER data are not bad or even good. Sometimes those big sells are set up to happen at the ER liquidity flush and nothing can stop them....a big dip will be bought back unless there are other things going on maybe in the markets...so, know your quarry...if one is going to trade ER setups I could see the wisdom in concentrating on a set list of names that one studies and knows well over time....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,198
  • Edited 10:24pm Nov 12, 2015 9:23pm | Edited 10:24pm
I have been bringing in long vol trades this week, trying to fill VXX Dec2/Dec calls calendars @ $28, $29 and up - trying to debit 15c or less, filled one so far @ $28

(I have Dec/Dec4 $26, $27 calls calendars too.....maybe set those too low, we'll see....but they were cheap, <10c, so....good thing they are calendars....I don't think I have any VXX or UVXY diags....just calendars & bflys.....too afraid of the wild move potential to risk the diag death slide....)
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-11-12_1915vxx.png Size: 75 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,199
  • Nov 12, 2015 9:45pm Nov 12, 2015 9:45pm
Quoting StrayDog
{quote} Hi CG, TF... I am not so happy with my trading results. ...... As TF said once - "you have to deserve the right to trade big", and until then, I am building my confidence....
Good luck, amigo. I am doing well enough just trading the broad market moves with SPY and some vix products. As far as trading in size goes, I'm all for it, but only when the time is right. Like now.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,200
  • Nov 12, 2015 10:32pm Nov 12, 2015 10:32pm
Quoting ZebraSquirl
With today's price action, I may have missed the VIX train leaving the station, at least for the moment. One thing about VIX: it's somewhat unwieldy in the sense that the expirations aren't that flexible, but the floor is a lot cleaner to work with than VXX or UVXY. UVXY requires patience; it's best just to set it up for a price at which you're willing to play and then not chase ... .
not to overflog this mule, & I wouldn't if I didn't think the opp were not "yuuuuge!".....there is still time to spread into Jan for another massive vix spike....below is the anatomy of the one that occurred on the late August China scare...in UVXY....stayed above $50 for weeks....
Attached Image (click to enlarge)
Click to Enlarge Name: 2015-11-12_2028uvxy.png Size: 72 KB
"If The Fool persists in his Folly he will become wise." - William Blake
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