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Let's Trade Options

  • #13,721
  • Jun 27, 2016 3:52am Jun 27, 2016 3:52am
Quoting The Fool
{quote}I am really a cheapskate....that's why I trade options....I will need to see XIV take a deep dive before I commit to tying up some money in those notes, certainly $15 if not lower...
Markets bouncing back and forth but mostly back now. I like to see the S/P fall below 2000. Then the party begins; I believe
  • #13,722
  • Jun 27, 2016 4:05am Jun 27, 2016 4:05am
The overall sentiment is quite bad now, I think the path of less resistance is to the downside. Market allready had an oversold bounce - it happened on Friday.
Once we have a daily close bellow 2000 - then target moves to 1950 and bellow.

(Last week I bought some UVXY July 1st 14/14.50 call spreads for $0.11, just in case of Brexit Small number but I will take the money.)

For this week,
I have sold /ES Aug 2050/2080 call spread for $14.00 CR.

Looking to buy some weekly IWM put spreads - this index will have to play catch up with the rest, IMO... look at the charts and May 19th low around 108...
Interested in something like 110/109.50 or whatever with 1:5 risk/reward. Maybe even finance those mofos with some wider call credit spreads.

Short the rip if you find one.

add-on
IWM plan
Attached Image (click to enlarge)
Click to Enlarge Name: IWM-plan.PNG Size: 131 KB
Hope is dangerous in this game.
  • #13,723
  • Jun 27, 2016 4:40am Jun 27, 2016 4:40am
Similar strategies for DAX also (there are options on DAX cash index on IB, with working hours 9 - 17:30 german time)

Since this is primarily european problem, it would be logical to asume that the most damage is going to be in Europe... Like with Ukraine crisis, but this can be much more harming on the long run. For DAX, I would target the low of Friday which was about 9150 as the first swing trade target - with expectance to see it there by the end of the week... with options, would buy a 9250/9200 put spread maybe if it comes cheap. Strikes are on every 50 points. The bid/ask spread on these DAX options are very large, though, so I guess it will be a mofo to fill. I have traded them a few times, but only buying singles...
Hope is dangerous in this game.
  • #13,724
  • Jun 27, 2016 6:36am Jun 27, 2016 6:36am
Quoting StrayDog
The overall sentiment is quite bad now, I think the path of less resistance is to the downside. Market allready had an oversold bounce - it happened on Friday. Once we have a daily close bellow 2000 - then target moves to 1950 and bellow. (Last week I bought some UVXY July 1st 14/14.50 call spreads for $0.11, just in case of Brexit Small number but I will take the money.) For this week, I have sold /ES Aug 2050/2080 call spread for $14.00 CR. Looking to buy some weekly IWM put spreads - this index will have to play catch up with the rest, IMO......
IWM or RUT has the highest IV out of the lot (SPY, QQQ, IWM, DIA) ... . I will probably go RUT IC, but am going to wait for these Monday jitters to pass ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,725
  • Jun 27, 2016 6:41am Jun 27, 2016 6:41am
Quoting StrayDog
Similar strategies for DAX also (there are options on DAX cash index on IB, with working hours 9 - 17:30 german time) Since this is primarily european problem, it would be logical to asume that the most damage is going to be in Europe... Like with Ukraine crisis, but this can be much more harming on the long run. For DAX, I would target the low of Friday which was about 9150 as the first swing trade target - with expectance to see it there by the end of the week... with options, would buy a 9250/9200 put spread maybe if it comes cheap. Strikes are...
Also good idea; unfortunately, our Euro options here in the US are limited ... . It's either FTSE futures or something like a Euro ETF (ugh). Those "monster" things like DAX, NDX, SPX take some fiddling with the fill due to size of the underlying ... . NDX, which is like 4300, will wash back and forth over the mid price by .15-.20, so I just put in an order for .10-.20 above the mid, watch it for a little bit and see which side it's tending towards, adjust ... . But the strike increments are ordinarily like $25 wide, so a bit goofy to work with ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,726
  • Jun 27, 2016 8:19am Jun 27, 2016 8:19am
Quoting ZebraSquirl
... NDX, which is like 4300, will wash back and forth over the mid price by .15-.20, so I just put in an order for .10-.20 above the mid, watch it for a little bit and see which side it's tending towards, adjust ... . But the strike increments are ordinarily like $25 wide, so a bit goofy to work with ... .
That is the reason why I do /ES futures options. Good liquidity, tight(er) bid/ask spreads, round the clock working hours... Off course, SPY and other index ETFs options are champs for tight bid/ask spreads, but ... you explained that above, as I did that also a long time ago. For other index futures, /NQ is also doable, and others has really shitty options.
Hope is dangerous in this game.
  • #13,727
  • Jun 27, 2016 8:45am Jun 27, 2016 8:45am
Hey, good to see you, SDog. I am sitting here scratching old head about behavior of the ^VIX this morning....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,728
  • Jun 27, 2016 8:47am Jun 27, 2016 8:47am
Quoting The Fool
Hey, good to see you, SDog. I am sitting here scratching old head about behavior of the ^VIX this morning....
I'm scratching more than my head and really cant figure this one out.
  • #13,729
  • Jun 27, 2016 9:19am Jun 27, 2016 9:19am
Quoting peterdrill
I'm scratching more than my head and really cant figure this one out.
omg what does the spoos have to do to move /VX? down 25+ and /VX has basically flat-lined since the LO? What a farce....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,730
  • Jun 27, 2016 9:58am Jun 27, 2016 9:58am
Quoting The Fool
{quote}omg what does the spoos have to do to move /VX? down 25+ and /VX has basically flat-lined since the LO? What a farce....
I'm waiting for the long term implied volatility on the VIX to kick in
  • #13,731
  • Jun 27, 2016 10:16am Jun 27, 2016 10:16am
Quoting The Fool
{quote}omg what does the spoos have to do to move /VX? down 25+ and /VX has basically flat-lined since the LO? What a farce....

Yeah, the mofo is not moving, while VXN (Nasdaq vol index) is +6%

Attached Image


And... VXST, which is short term SPX vol, is actually down 4% (VIX measures 30 day vol, while VXST is 9 days)
Hope is dangerous in this game.
  • #13,732
  • Jun 27, 2016 10:23am Jun 27, 2016 10:23am
IWM is down more than DAX, amazing... -3.8% and -3.5%.

I didn't manage to fill anything (option spreads) on both of them. Made some decent cash scalping around
Hope is dangerous in this game.
  • #13,733
  • Jun 27, 2016 10:24am Jun 27, 2016 10:24am
Quoting StrayDog
{quote} Yeah, the mofo is not moving, while VXN (Nasdaq vol index) is +6% {image} And... VXST, which is short term SPX vol, is actually down 4% (VIX measures 30 day vol, while VXST is 9 days)
wait till near the end of day if it does not move or even fall then expect some kind of hard bounce in equities, I'm eyeing on going long on spot euro as the volatility is less on that pair and put my stop 100 pips away, reduce the leverage and money so my risk still stays relatively small
  • #13,734
  • Jun 27, 2016 10:27am Jun 27, 2016 10:27am
Quoting Cecil Gee
{quote} wait till near the end of day if it does not move or even fall then expect some kind of hard bounce in equities, I'm eyeing on going long on spot euro as the volatility is less on that pair and put my stop 100 pips away, reduce the leverage and money so my risk still stays relatively small
holding that trade till end of session, euro at 1.0976 as of writing
  • #13,735
  • Jun 27, 2016 10:33am Jun 27, 2016 10:33am
Quoting Cecil Gee
.... if it does not move or even fall then expect some kind of hard bounce in equities, I'm eyeing on going long on spot euro as the volatility is less on that pair and put my stop 100 pips away, reduce the leverage and money so my risk still stays relatively small
There could be a bounce, first gap on SPX cash index on 1991 got filled, VIX is down, etc... you are right about that.
These divergences are a thing to watch.
Bounce could go just to re-test 2000 on /ES and that is it, idk I expect more downside to come.
Hope is dangerous in this game.
  • #13,736
  • Jun 27, 2016 10:40am Jun 27, 2016 10:40am
Quoting StrayDog
{quote} There could be a bounce, first gap on SPX cash index on 1991 got filled, VIX is down, etc... you are right about that. These divergences are a thing to watch. Bounce could go just to re-test 2000 on /ES and that is it, idk I expect more downside to come.
yes agree with you, I to expect further downside i just didn't phrase it properly by say hard bounce. expecting a decent retrace
  • #13,737
  • Jun 27, 2016 10:46am Jun 27, 2016 10:46am
Yeah np C.G.... amazing how /ES respects techical levels... that gap on SPX (1991) is in the same time Low Volume Node on /ES volume profile (/ES 1981).
Low of today - 1981.50 on /ES... and 1990 on SPX.

Attached Image (click to enlarge)
Click to Enlarge Name: SPX-gaps2.PNG Size: 186 KB


Two more on the downside... Nice bounce from this first gap, 10 points so far
Hope is dangerous in this game.
  • #13,738
  • Jun 27, 2016 11:27am Jun 27, 2016 11:27am
Anyone out there started trading VMAX or VMIN? I was curious how the fills were
  • #13,739
  • Jun 27, 2016 11:36am Jun 27, 2016 11:36am
Quoting The Fool
{quote}omg what does the spoos have to do to move /VX? down 25+ and /VX has basically flat-lined since the LO? What a farce....
I think people are realizing they over reacted friday. VIX is still dropping despite SPX being down 1.5%Nothing really has changed in Britain. They have 2 years to negotiate an exit and that does not start until the PM invokes article 50 which he hinted won't happen till after he laves in Oct.I would expect British multinationals to feel pressure as they dont know what deal yhey will get.I also expect London to lose it status as financial capital of Europe over next 2-3 years. US stocks really shouldn't be getting punishedIf you look at the futures curve it is still shallow indicating expectations are of a reboundIt is good to compare vix curves to past events
  • #13,740
  • Jun 27, 2016 12:38pm Jun 27, 2016 12:38pm
Quoting Sherpa
{quote} I think people are realizing they over reacted friday. VIX is still dropping despite SPX being down 1.5%
it's a fucking joke.
"If The Fool persists in his Folly he will become wise." - William Blake
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