That dead cat bounce did…

That dead cat bounce did not stay in the air long. I will be adjusting trades to neutral to bearish stance or at least to trades that won’t get killed with whipsaws.

Have a lot of trades ITM that expire this week and next week.

ADDED GOOS STOCK @40.75 to…

ADDED GOOS STOCK @40.75 to balance my earlier entry, at a higher buy.

#shortputs NKTR Sold Sept. 20,…

#shortputs NKTR
Sold Sept. 20, 17 put for 1.16.

TRADES:

GOOS BTO STOCK 43.06 I was early. Starter position.
GOOS STO 8/16/19 43.0 CALLS @1.60

SPX 1-dte stopped

#SPX1dte My stop was hit at the open so my order to close put side filled on the little spike up we just had.

BTC $SPX Aug 14th 2865/2845 put spreads for 3.00. Condors sold yesterday for 1.05.

Also, working to close the Aug 16th 2775/2750 put spreads which were sold Monday in a condor. Should have closed yesterday except for deer-in-headlights syndrome.

SHOP

STO August 23, 340 puts @ 3.72

Leveraged ETFs

Many of us have been trading these to the short side for a long time, but for anyone who needs a refresher, here is a good summary on the pitfalls of being long these 2x and 3x products for any length of time beyond really short term. They can be supercharged if they’re going straight up for example, but in volatile environments they can grind you out.
https://www.proshares.com/funds/performance/the_universal_effects_of_compounding.html

SPX 1-dte

#SPX1dte Sold to Open $SPX Aug 14th 2845/2865-2965/2985 condors for 1.05, IV: 15.76%, SPX 2923

#ironbutterfly UVXY #tastytradefollow Sold Sept….

#ironbutterfly UVXY

#tastytradefollow Sold Sept. 20, 20/32/32/38 for 6.23, profitable above 25.75, UVXY currently at 32.50.

TLRY trade

#Earnings Sold to Open $TLRY 40.5/44.5/48.5 #IronButterfly for 2.95. Risking 1.00 to make 2.95. This has a decent chance of max loss, but the R/R make it worth the shot. Also, three days for it to return to the middle if it moves far tonight.

#earnings #closing BABA May 15,…

#earnings #closing BABA
May 15, I sold a 160/165 put ratio spread with BABA flirting with 180. BABA then flirted with 149. May 31 I started the adjustments, sold a call, ending with an inverted 160 call/175 put strangle. I closed it today with earnings around the corner, making $93, whew.
The next problem is ROKU…

TLRY earnings analysis

#Earnings $TLRY reports tonight. Below are details on earnings one-day moves over the last 4 quarters, which represent its entire history of earnings reports.

May 14, 2019 AC +0.32%
March 18, 2019 AC -3.39%
Nov. 13, 2018 AC -8.25% Biggest DOWN
Aug. 28, 2018 AC +20.64% Biggest UP

Avg (+ or -) 8.15%
Bias 2.33%, positive bias on earnings.

With stock at 43.00 the data suggests these ranges:
Based on current IV (expected move into Friday per TOS): 38.02 to 47.98
Based on AVERAGE one-day move over last 12 quarters: 39.50 to 46.50
Based on MAXIMUM one-day move over last 12 Q’s (20.6%): 34.12 to 51.88
Based on DOWN max only (-8.3%): 39.45

Open to requests for other symbols.

UBER strangle stopped

#PerpetualRollingStrangles BTC $UBER Aug 30th 37 put for 1.50. The 37/43.5 strangles sold for 1.08 on Friday.
Nice thing about these is how small the loss is if your strike is breached. I will allow the call to close for .05.

I will give it a day or two before selling a new one.

NVDA

#CoveredCalls – Not really an earnings trade but taking advantage of the big premium. Of course sold 30 seconds too early.

Sold NVDA AUG 16 2019 150.0 Call @ 7.25

Headline sensitive, anyone?

https://platform.twitter.com/widgets.js

TNA

#CoveredCalls – Out all day yesterday but had one fill.

Bought to Close TNA AUG 16 2019 59.0 Calls @ .10 (sold for 2.70)

Today selling aggressively at the open:

Sold TNA AUG 23 2019 52.0 Calls @ 2.85

Of course 20 seconds after the sale the China announcement (rumor) comes out. Can’t believe people actually believe anything’s going to happen over there.

Taking a flyer. Earnings this…

Taking a flyer. Earnings this week. Not holding. A trade for a day or two. 1/2 position.

GGAL BTO STOCK @17.46 Tight grip.

SPX

Expiring SPX 8/12/2019 2845/2860/2970/2985 #IC. Was STO 8/9 @0.95.

Market

Not much of a rally at the close. It could get ugly tomorrow.

SPX 4-dte

#SPX1dte Sold $SPX Aug 16th (Friday PM) 2750/2775-2950/2975 condors for 3.45, IV 22.57%, SPX 2880.

Crazy as a Loon, or…

Crazy as a Loon, or Goose, Honk, honk. ;>)

GGAL STO 8/16/19 20.0 CALLS @.55 Stock is down over 20.0 points. Expires Friday. Delta .32, reasonable risk reward. ;>)

Lightening a bit on DRIP

I put this on last week, taking it off for 50% of the profit, Still have quite a bit of short call exposure. Bought $DRIP 9/20 164 call @ 4.50. Sold for 9.00.

A TRADE:

ARWR BTO STOCK @29.40

PYX

#CoveredCalls
$PYX STO Sep20 15 Covered Calls @ 1.00

TRADES:

YETI STO 8/16/19 30.0 CALLS @.55
STNE STO 8/16/19 36.0 CALLS @1.10

A TRADE:

STNE BTO STOCK @34.55

INTC puts

#PieTrades Sold to Open $INTC Sept 6th 46 puts for 1.50.

Since my on-going favorite $T is not near 52-week lows, I’ve switched to $KHC and INTC for my PieTrades.

YELP closed

#Earnings Sold to close $YELP 34.5 calls for 3.00 average price. Got a couple sold for a small profit this morning, but made the mistake of waiting for it to go higher and it collapsed instead. These are usually winners, but pretty tough to manage. I think I need to try trailing stops.

#LongStrangles bought yesterday for 4.23. This loss and the UBER win cancel each other out.

AMD SPX

STO $AMD Sept 20 2019 34 puts @2.23. Was ATM when sold. Cash Secured. Willing to own the stock.
Expiring $SPX 2850/2865//2965/2980 #IC. Was STO @1.05 yesterday following Jeff.

Have rolled pretty much everything else out and or up this week. Sorry haven’t posted all of the trades. Finding that some have turned out to be unneeded, as things generally recovered. I need to be more patient.

SPX 1-dte

#SPX1dte Sold $SPX Aug 12th 2840/2860-2970/2990 condors for 1.10. IV: 11.71%, SPX 2929

Expiring today: Aug 9th 2840/2860-2960/2980 condors, sold yesterday for 1.35

UBER strangles

#Earnings #PerpetualRollingStrangles
Since today’s 39.5/45.5 earnings strangle look to be expiring worthless, I’m resuming what worked for me for a couple months after my earnings losing trade in May:

Sold $UBER Aug 30th 37/43.5 strangles for 1.08

A TRADE:

OSTK STO 8/16/19 22.5 PUTS @.65

LNG

Converted short puts that are way ITM to #fuzzy to the 65/65/61 put strikes. Cost basis 9.39 and 8.96 and will sell weeklies until 2021.

Only had 2 contracts but this allowed me to increase to 7 contracts so a lot more weekly selling power/income.

We ran an experiment with XBI from June 21 on strictly weekly sales at the 80/85 strikes. 60% ROI since then or 520% annualized returns which is a lot more than we expected. Will keep it running and see how it works out longer term. I would expect less going forward but interesting that certain tickers trade LEAPs better than others.

Econ Calendar for week of 8/12/19

Screen Shot 2019-08-09 at 10.32.17 AM
Screen Shot 2019-08-09 at 10.32.17 AM

Link to calendar: https://us.econoday.com/byweek.asp?day=12&month=8&year=2019&cust=us&lid=0

#shortputs NKTR I unfortunately own…

#shortputs NKTR
I unfortunately own 110 shares of NKTR, 100 assigned at 60, cost basis is 48. NKTR is down 32% today to 20 after earnings, sure wish I would have had disaster protection. Sold an Aug. 16, 20 put for 1.00, going to be in this one awhile.

PYX

#CoveredCalls
BTC Aug 16 15 cc @ .10, STO on July 22 @ 1.42. Off to the dispensary. Thanks, @honkhonk81

Hmmm, thought I posted, but…

Hmmm, thought I posted, but didn’t, so here goes.

YETI STO 8/16/19 30.0 PUTS @1.15
STNE BTO STOCK @36.38
STNE STO 8/16/19 38.0 CALLS @1.10

#tastytradefollow OSTK DD OSTK sold…

#tastytradefollow OSTK DD
OSTK sold Sept. 20, 17.50/30 strangle for 1.87
DD sold Sept. 20, 65/77.50 strangle for 1.50

#earnings #closing UBER Bought Sept….

#earnings #closing UBER
Bought Sept. 20, 35/50 strangle for .75, sold yesterday for 1.35, thanks for the data Jeff.

Z assignment

#Earnings Sold to close $Z Aug 9th 40 puts for 1.00. Lowers cost basis of tonight’s assignment to 41.74, via assignment of the 44 short puts. Condors sold Wednesday for 1.26.

Smaller account: sold 42 puts for 2.65, cost basis 40.60. Will close the short put if we recover to that level today.

REGN

#CoveredCalls – Same as WYNN. Fairly aggressive through earnings.

Bought to Close REGN AUG 09 2019 312.5 Call @ .10 (sold for 5.10)

Sold REGN AUG 23 2019 315.0 Call @ 3.80

WYNN

#CoveredCalls – Sold earnings premium pretty aggressively and it paid off…

Bought to Close WYNN AUG 09 2019 113.0 Call @ .10 (sold for 5.70)

Sold WYNN AUG 30 2019 112.0 Call @ 2.20

HI

Sorry about the radio silence for a few months. After my injury and recovery I have been too busy at work to post. Does not mean I have not been trading, just did not have time to post. I am finally caught up to the point I can contribute again.

So anyway, hope everyone is doing well. I sorted out how to separate my personal trades from the service and will start posting again. Most trades will be posted end of day but they are usually good for a few days. I also have too many on for update so will just start fresh and post as we go. I mostly trade on Thursdays so that is when updates should occur.

As some of you know I traded full time for 5 weeks as I was recovering. I am also part of the Traders Reserve family and have been working with them professionally. While I was off I binged watched tastytrade, looked at all of the research we have been doing, and experimented with several new tactics that have all been very successful. I will try to keep this short but some of the things I have learned have changed my trading techniques.

So here we go as a summary. Took the case study account from 50k to $75,983 from Jan 1 to June 30. It was more than that but this weeks pull back dropped it a few thousand. Regardless, a 50% increase in 6 months is not too shabby. This included some losing trades, I am not cherry picking here and will attach a screen shot to show this is legit and you can see I am up another 10k from June 30.

So here is what I have and have become very mechanical in my trading. Some people may think it is boring but I trade to make money, not for excitement. If I want excitement will go ski, kiteboard, bike race, or mt bike and hopefully not break any bones again.

  1. Selling options works. The only thing is have to be able to control those big losses that can occur from selling naked options. If you control that you win in the long run.
  2. I am not a directional trader. Congratulations to those that can do it, but even full time trading I could not make it work. However, adding a directional component to option selling has increased my win/loss ratio which improves returns.
  3. Keeping a portfolio hedge on at all times allows you to be much more aggressive selling options. That way if SPY goes to zero the hedges will be worth way more than the accounts. I target hedging each account for a 10% correction meaning that much of a drop will result in no losses. Any more than that and I have a winning lottery ticket. I will explain next time I roll my hedges but have been using /ES. SPX or SPY also work. I also hedge using a risk twist or ratio write so it does not cost as much or a debit spread if I am hedging a fixed amount.
  4. I finance the hedges by selling options so they only cost me house money.
  5. I usually start a position by selling puts. If it moves against me will roll. If that does not work will convert to a #jadelizard. After a few rolls of the jade lizard if that does not work will convert to a LEAP spread and manage it from there.
  6. A position may last a week or several months to years. Depends on what I am trying to accomplish but the end goal is steady income.
  7. TT found 45 DTE opening to managing at 50% returns or 21 DTE closing is ideal for theta decay. We have found 21 DTE may be even better (not in all situations). Our research has found that most OTM options will crush 90% in 10 days after opening at 21-22 DTE. Allows recycling capital quicker, faster decay, but less trades have to be adjusted. Has been the sweet spot this year. As market conditions change that may change as well.
  8. Jade lizard trades allow skewing, flexibility with adjusting, and huge income up front.
  9. Trading through market volatility increases returns once the market rebounds because you are always recycling your cash and adding to positions and basically hyper compounding.
  10. Keep margin balance to no more than 25-50% of total available that way you don’t get margin calls when the market is melting down.
  11. Don’t be emotional when trading (hard to do when your account is down) but must be done. Most people sell at the absolute bottom or buy at the top because of emotions. If they just stayed in the market they would be better off. It is only money, not your life, or face 🙂
  12. Be willing to adapt to what the market is doing. Too many people trade the same way no matter what the market is doing. Different tactics work in different markets but you have to trade the market you are in.

This community helped me realize a lot of this. Most of you are willing to take a chance, experiment with new tactics, and stay in the market even when the proverbial sh#$ hits the fan. Thanks for the help and happy to be back!

Cheers, Chris

Took me a while to figure out how to post a screen shot, but here are the returns for the year so far.

Continue reading

SPY

#ShortPuts – Playing this as a temporary bounce and taking the quick profit…

Bought to Close SPY OCT 18 2019 270.0 Put @ 2.89 (sold for 5.50)

SPX 1-dte

#SPX1dte Sold $SPX Aug 9th 2840/2860-2960/2980 condors for 1.35. IV 16.74%, SPX 2928.

A little more aggressive (.07/.08 short deltas) than my usual, but betting on a quieter day after today’s rally.

KHC

#ShortPuts – Had to leave for awhile today so missed the biggest drop. Trying to catch a little bit of the move anyway. Starter position at 34% annualized if held to expiration or a 6.2% divvy @ a 25.80 basis. Hopefully get to add a couple more later. Thanks @honkhonk81 for the heads up!

Sold KHC SEP 06 2019 26.5 Puts @ .70

A TRADE: ADDED

KHC BTO STOCK @27.29 Now a full position. Closed out my 27.0 SHORT CALLS, at a -.05 loss.

45 degrees

#Market It’s rare to see such a straight line in either direction for almost 4 hours with no significant bumps.

#earnings #closing Z Bought Sept….

#earnings #closing Z

Bought Sept. 20, 40/60 strangle for 2.10, sold yesterday for 2.28, took the teeny tiny gain instead of managing.

A TRADE: Where “Angels Fear to Tread”.

KHC BTO STOCK @26.90 To go with my short calls & puts.

YELP trade

#Earnings Bought to Open $YELP Aug 9th 34/34.5 #LongStrangle for 4.23.

UBER earnings trade

#Earnings $UBER has only reported once, on May 30th, and the next day move was +1.5%. (Max intraday was +4.4%)
Expected move on TOS is +/- 3.59.

Sold $UBER Aug 9th 39.5/45.5 strangles for 1.05. Strikes are 7.1% OTM.

#perpetualrollingstrangles

YELP earnings analysis

#Earnings $YELP reports tonight. Below are details on earnings one-day moves over the last 12 quarters.

May 9, 2019 AC -14.37%
Feb. 13, 2019 AC -0.70%
Nov. 8, 2018 AC -26.59%
Aug. 8, 2018 AC +26.65% Biggest UP
May 10, 2018 AC -7.81%
Feb. 7, 2018 AC -14.04%
Nov. 1, 2017 AC -0.10%
Aug. 3, 2017 AC +27.66%
May 9, 2017 AC -18.35%
Biggest DOWN
Feb. 9, 2017 AC -13.64%
Nov. 2, 2016 BO +9.94%
Aug. 9, 2016 AC +12.83%

Avg (+ or -) 14.39%
Bias -1.54%, negative bias on earnings.

With stock at 34.10 the data suggests these ranges:
Based on current IV (expected move into Friday per TOS): 29.64 to 38.56
Based on AVERAGE one-day move over last 12 quarters: 29.19 to 39.01
Based on MAXIMUM one-day move over last 12 Q’s (27.7%): 24.67 to 43.53
Based on DOWN max only (-26.6%): 25.03

Open to requests for other symbols.

#longstraddle, #longstrangle

Ketch-down

#PieTrades #dividends Bought some stock in one account at 26.70. On all accounts, started a #PieTrade:
Sold $KHC Aug 23rd 27 puts for 1.23

thanks for the idea @honkhonk81

SPX bailing

#SPX1dte Getting ripped to the upside so I had to bail. Yesterday’s open was possibly the low, and I should have realized that as the market ticked steadily higher in the afternoon. Instead, I doubled down. Live and learn (or make bad trades and learn). That ends my streak of killer returns that started with the Upside Warning on July 5th. I will now resume neutral trades until the market shows its true direction. Probably going higher but not certain until VIX gets lower.

BTC $SPX Aug 12th 2900/2925 call spreads for 15.35. Sold for 9.00 on Tuesday.
BTC $SPX Aug 9th 2910/2935 call spreads for 10.60. Sold for 5.20 yesterday.

TRADES: Dancing w/devil. ;>)

KHC STO 8/9/19 27.0 NTM CALLS @ .50
KHC STO 8/9/19 26.5 NTM PUTS @.44 Expires tomorrow.

WYNN

#CoveredCalls – Assigned early on some stock which was fine with me. Getting a chance to sell into the bounce and capture the divvy next week.

Sold WYNN AUG 30 2019 115.0 Call @ 2.54

#rolling ROKU Rolled Sept. 20…

#rolling ROKU

Rolled Sept. 20 60 put to 90 for 1.34, put is from 60/140 earnings strangle. ROKU is at 120.

#earnings #closing LYFT Bought 2…

#earnings #closing LYFT

Bought 2 calls X 1 put Aug. 16 strangle for 1.15, sold yesterday for 3.55.

DIS put spread

Sold $DIS 9/20 130/120 bull put spread @ 1.57

#earnings LYFT #tastytradefollow Sold Aug….

#earnings LYFT Z

LYFT #tastytradefollow Sold Aug. 16, 52/70/70 strangle for 3.55.
Z sold Sept. 20, 40/60 strangle for 2.28, thanks for the data Jeff

X puts

Sold $X 9/20 11 puts @ .50

Z earnings trade

#Earnings Sold $Z Aug 9th 40/44-56/60 condors for 1.265. It’s got a couple of big moves recently but otherwise fairly quiet. Also sold 42/44-56/58 for .75 in smaller account.

#earnings ROKU Sold Sept. 20,…

#earnings ROKU

Sold Sept. 20, 60/140 strangle for 2.57 with ROKU around 100.

SPX 2-dte

#SPX1dte Sold $SPX May 9th 2910/2935 call spreads for 5.25. Still looking for more downside, or at least resistance at 2900.

Z earnings analysis

#Earnings $Z reports tonight. Below are details on earnings one-day moves over the last 12 quarters.

May 9, 2019 AC +5.04%
Feb. 21, 2019 AC +26.36% Biggest UP
Nov. 6, 2018 AC -26.92% Biggest DOWN
Aug. 6, 2018 AC -14.77%
May 7, 2018 AC -1.44%
Feb. 8, 2018 AC -2.67%
Nov. 7, 2017 AC +2.67%
Aug. 8, 2017 AC -9.05%
May 4, 2017 AC +9.29%
Feb. 7, 2017 AC -6.37%
Nov. 1, 2016 AC +6.32%
Aug. 4, 2016 AC -4.73%

Avg (+ or -) 9.64%
Bias -1.36%, negative bias on earnings.

With stock at 50.00 the data suggests these ranges:
Based on current IV (expected move into Friday per TOS): 43.33 to 56.67
Based on AVERAGE one-day move over last 12 quarters: 45.18 to 54.82
Based on MAXIMUM one-day move over last 12 Q’s (26.9%): 36.54 to 63.46
Based on UP max only (+26.4%): 63.18

Open to requests for other symbols.

DRIP new highest strikes

Sold $DRIP 9/20 164 Call @ 9.00

TRADES:

PAYS STO 8/16/19 12.5 PUTS @1.00
PAYS STO 8/16/19 12.5 CALLS @.80 Will cover if necessary.
CSII BTO STOCK @43.75
STNE BTO STOCK @34.99

#earnings #closing WYNN Bought Sept….

#earnings #closing WYNN

Bought Sept. 20, 90/130 strangle for 2.38, sold yesterday for 3.02. Maybe several other trades can cooperate now.

TNA

#CoveredCalls – Basis reduction is about all you can do here…

Bought to Close TNA AUG 09 2019 59.0 Call @ .08 (sold for 1.56)
Sold TNA AUG 16 2019 54.0 Call @ 2.05

SPX 1-dte stopped

#SPX1dte BTC $SPX Aug 7th 2795/2775 put spreads for 1.40. Condors sold for 1.25 yesterday.
At the lows, SPX was within its expected move to my short strike, so I’m stopping out on the bounce.

SQ

#CoveredCalls – Getting some fresh premium going while volatility is still up a little…

Bought to Close SQ AUG 16 2019 71.0 Calls @ .20 (sold for 1.34)
Sold SQ SEP 6 2019 70.0 Calls @ 1.27

SPX 1-dte

#SPX1dte Sold $SPX Aug 7th 2775/2795-2930/2950 condors for 1.25, IV 21.5%, SPX 2877.

A TRADE:

CSII BTO STOCK @42.98

TRADES:

STNE STO 8/16/19 38.0 CALLS @.70
AMD STO 8/9/1930.0 CALLS @.23 COVERED
YETI STO 8/9/1930.0 ITM PUTS @1.05