Non financial article about bitcoin, sure uses a lot of energy. I suppose when the energy to maintain it is more than the value that is when the bubble will burst. Now, wish I had bought 100 share in 2011, now worth 4 million.
Pretty quiet trading day for me, thanks again for everyone’s good ideas:
1. Took the HD BePS profit I was expecting this morning (Bought 1.09, sold 1.59)
2. Bought PIR long calls for Earnings run up (closes 1 day before earnings), target 40%
3. SHAK BePS for retracement from extreme up move, .84 debit, target 50%, trade is green
4. BA BePS for retracement from extreme up move, 1.21 debit, 50% target, trade is red
5. ADSK #ShortPuts for Mar, thank you for the idea @jsd501
6. I’m keeping 2 short /ES contracts hedged with short puts, rolled short puts to next week for additional credit. This “Z” contract will run out pretty soon.
7. CVX closed BuCS for 50% loss (I’m testing using “probability of touch” as a stop on debit trades)
8. RCII There was an almost 10,000 contract opening call sale today for Jan 13 calls, so I bought a BePS Jan 13/11 for 1.14 (paid less than intrinsic). Following the “smart money” fund flow on this (I realize this may be Trader setting a hedge vs a spec trade, but it’s limited risk)
9. New NDX #Bitty Dec 29 6125/6120 for .85 cr, 50% target
Active Greens: ADSK, AFL, AMC, BBY, ETFC,FB, LRCX, MNST, MSFT,NDX,NTNX,ORCL, SHAK, TTWO,
Active Reds: AAPL, ALGN, DLTR, JPM, LMT, NUE, PIR, QQQ, SPY, ULTA, /ES, BA (net green)
3% return on capital today
#Earnings – I’ve got the AZO winner in the bank so rolling the dice on all my RH profits with a defined risk iron fly 10 wide with an expected move of 11.75. Risk about 2 to make 8. Leaning slightly bullish with the stock sitting at support.
Sold AVGO DEC 8 2017 255.0/265.0/275.0 Iron Fly @ 7.82
Sold NVDA JAN 17 2020 190.0 Puts @ 37.75
Bought NVDA JAN 17 2020 190.0 Calls @ 43.70
Adding tight disaster puts. If it implodes I’ll roll this down and re-invest the profits back into more longs.
Bought to Open NVDA JAN 17 2020 185.0 Puts @ 35.05
This gives a net debit of 41.00 for the Jan 2020 position. Add the 5 point max downside and get a max loss possibility of 46.00. Based on that, and the 110 weeks remaining in the trade I only need to average about 42 cents per week in sales to cover the absolute worst case scenario. And…NVDA has great weekly premium.
Sneaking my first sale in this week to cover the small DIS loss:
Sold NVDA DEC 8 2017 195.0 Calls @ .48
#SyntheticStock – As @1strangealien and I were discussing down below I’ve bailed on DIS for a small loss and established a new position in NVDA (one of my favorites). Decent liquidity and great premium for weekly selling against the long term position.
DIS details: (I’ll post seperately with the NVDA details)
Sold to Close Jan 2020 100 strike synthetic stock @ 6.90
Sold to Close Jan 2020 90 strike disaster puts @ 5.50
Bought to Close Jun 2018 105 calls @ 6.70
Net credit of 5.70 plus front month premium received of .40 so 6.10 total. Cost to enter the trade was 6.63 so final numbers work out to a loss of .53. I’ll roll that into my NVDA cost and have it made up this week. LOL Hate a loser but really wanted a crack at NVDA so happy to close it.
Guys on Fast Money talking about a lot of selling happening to realize gains in 2017 before next year and the new tax plan. May be reason for drop in last 25 minutes.
STO January 12, 70 put @ 1.30
STO January 5, 70 put @ .95
STO July 155 put @ 1.30, Hat tip to Iceman.
STO March 90 put @ 2.15 on 1 contract.
BTC EWZ Dec08’17 41 calls for 0.07, Sold last week for 0.32, waiting to sell for next week.
Rolled DIS Dec08’17 103 call to Jan05’18 104 call for 0.35 credit. Still short a Dec29’17 101 call.
Getting some stuff done early, the boss will be peering over my shoulder next 2 days.
#ShortStrangles – Getting a jump on next week in case the 200ma doesn’t hold. Selling weeklies to lower basis in Jan 120 puts..
Sold ADSK DEC 15 2017 109.0 Calls @ 1.21
#ShortStrangles – Booking a little and a delta adjustment. Still slightly long…
Bought to Close EWW DEC 15 2017 51.0 Calls @ .19 (sold for 2.05)
Sold EWW DEC 22 2017 49.0 Calls @ 1.15
Selling weeklies against Jan 54 puts
#SPXcampaign Closed half my longs:
Sold to close $SPX Dec 8th 2620/2640 calls for 11.50. Bought for 3.50 on Nov 27th. Holding the other half to see what happens. I’m not too optimistic for much more upside this week, but I’m up for anything.
#ShortStrangles – First time in this one. Staying small…
Sold LRCX JAN 12 2018 160.0/200.0 Strangle @ 4.30
#ShortStrangles – Rolling down to slightly inverted…
Rolled SWKS DEC 29 2017 118.0 Calls to SWKS DEC 29 2017 100.0 Calls @ .90 credit
Position is now 103/100 inverted strangles @ 2.73
#Earnings – No interest in even taking a chance of getting any stock. Kind of a weak open so bailing with good profit. Thanks Jeff!
Bought to Close RH DEC 8 2017 90.0/120.0 Strangles @ 1.05 (sold for 2.40)
#Earnings Closed $RH Dec 8th 118 and 120 calls for .05. Sold yesterday for 1.20 and 1.15. Orders in to close Dec 8th 90 puts and Dec 15th 85 puts for .05.
Sold RH Dec 29th 85 put for 1.65. I’m almost back into profit after third quarter blowout, so keeping strangles going a bit longer.
$AZO 780 calls closed yesterday. Just closed Dec 8th 615 puts for .10. Strangle sold for 4.575, closed for .675.
Next up… AVGO
$SQ may have bottomed
Here’s an actionable trade idea for today (that I alluded to last night). I’ve been testing this for a little while now and it’s working exceptionally well with the market conditions we’ve got. Tasty Trade did a segment on Nov 29 regarding buying debit spreads for less than the intrinsic value. When applied to parabolic rises with the objective of a tiny pullback, it can be effective. Plus as a bear play it works quickly, I’m out of these trades in just a couple days. Buying a spread for less than intrinsic covers all types of volatility, and almost eliminates theta burn considerations.
Contrarian Candidates (Don Kaufman’s criteria): Stocks within 2% of all time highs, traded up 3% in last 10 days, + a blowout of a recent expected move, over 2x.
Trade: #PutDebitSpread where long strike is ITM, short strike is OTM, 1:1, pay less than intrinsic value, 50% target, around 30DTE, look for liquidity.
I’ve got a couple of these on where it looks like I’ll get more closes today: HD (3 days old), ETFC (1 day), BBY (1 day), DLTR (1 day)
I’ll report on any more additions today. It’s an easy simple trade with limited risk, little management.
p.s. Last night I called these reversion trades, but they really aren’t. A reversion trade would require a very significant pullback for these stocks. This is really just a rest/consolidation/flag trade on a stock that has been a rocket.
Here’s the TT video: https://www.tastytrade.com/tt/daily_recaps/2017-11-29/episodes/buying-spreads-for-less-than-intrinsic-value-11-29-2017