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Post by Del »

sweetandsour wrote: 01 Nov 2022, 07:49 SPY pre-market was above 390, and it opened right at 390, but quickly retreated to pick up where it left off yesterday in the mid 380s. My only position right now is Abt 20 shares of SPY at 390 that I bought back when 390 was support. If it'll get to 400 I'll sell it. If/when I gain confidence I'll buy a call like Del is doing.
My FA still expects SPX to go back to 3500.

Btw, for anyone buying heating oil, or driving a diesel, watch and plan for shortages and higher costs.
I bought the call on Friday morning. By Friday's close, I had $475 in profit.

As of 10:30 on Tuesday, I am back to break-even. The market is not happy about this morning's jobs report, which shows the employment is still tight and strong. Mr. Market reckons that the Fed will take this as a sign that more aggressive tightening is needed. More rate increases.

I am still bullish on SPY. I will give it the rest of this week, and maybe next week, to climb on top of the SPX = 3900 mark. If SPY reaches 391 to 392, I will see about $500 profit. I will probably close at that point. It is much safer to bank a tidy profit quickly than to hold on and hope for recovery.

If I don't close at 391 this week, I'll to see 392 next week to make the same profit. Time value never stops eating at a long option's value.... like termites.

On the other hand, today's pull-back has really helped my condor that expires tomorrow afternoon. I'm in the middle of my table, just 6.5% chance of getting into trouble. I have $6000 at risk. I got paid $1326 in premium last week. I'll set up another condor on Wednesday late afternoon or Thursday morning, after the market digests the latest Fed statements.

As I am doing well on the condor, I don't mind if I fail to make much on SPY.

However, if SPY had gone up a lot this week, then I might have given some back on the condor. The key is to have something in a winning position, whether the market goes up or not.

Meanwhile, the shares I'm holding in XLE keep chugging up the hill. I've made just over $2000 on my 100 shares, plus selling puts and calls.
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Post by Del »

sweetandsour wrote: 01 Nov 2022, 08:52
Del wrote: 01 Nov 2022, 07:56 Tell my about your Fidelity advisors. Is that a podcast that anyone can watch, or is it behind a paywall?
https://www.fidelity.com/learning-cente ... g-sessions

Click on "find a session" for daily market briefings. Sign up and then listen in.
I listened in on the after-market session. Some very helpful hints on technical analysis.... obvious things that I have overlooked. THANK YOU!

SPY is getting pinched -- It closed at 385: at the bottom of its current trading channel. Also just underneath its resistance at 389/390. It's going to bust through something tomorrow -- either up through resistance or down and out through the channel. And there will be a lot of volatility as it digests the FED rate meeting news and picks a direction.

I will decide in the early morning whether I want to bail on the long call option or ride it out. Don't be surprised if I bail. I'd rather miss a big gain than take a large loss. I can put the position back on if the market turns bullish.
=========================

I need to thank you for starting this thread. I've been doing very well since having someone to talk trades with. You've given me some good ideas.

You have also forced me to think differently. I used to try crazy things, and I lost money for several years. Now I always think, "How would I explain this trade to Tim?" And sharing a journal of monthly wrap-ups, too -- these keep me accountable. And I have done very well since.

Having a friend to talk trading with has made all the difference.

We are talking about some serious money. $10,000 gain in my trading account and $70,000 improvement in my retirement account.

So if I harvest a bit to travel down to Texas in the next year or two, with a case of 12-year old Macallan and a few tins of 10-year old McClelland, you're just going to have to deal with it. I'll buy us a table full of crawfish, too.
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Post by sweetandsour »

Del wrote: 01 Nov 2022, 20:06
sweetandsour wrote: 01 Nov 2022, 08:52
Del wrote: 01 Nov 2022, 07:56 Tell my about your Fidelity advisors. Is that a podcast that anyone can watch, or is it behind a paywall?
https://www.fidelity.com/learning-cente ... g-sessions

Click on "find a session" for daily market briefings. Sign up and then listen in.
I listened in on the after-market session. Some very helpful hints on technical analysis.... obvious things that I have overlooked. THANK YOU!

SPY is getting pinched -- It closed at 385: at the bottom of its current trading channel. Also just underneath its resistance at 389/390. It's going to bust through something tomorrow -- either up through resistance or down and out through the channel. And there will be a lot of volatility as it digests the FED rate meeting news and picks a direction.

I will decide in the early morning whether I want to bail on the long call option or ride it out. Don't be surprised if I bail. I'd rather miss a big gain than take a large loss. I can put the position back on if the market turns bullish.
=========================

I need to thank you for starting this thread. I've been doing very well since having someone to talk trades with. You've given me some good ideas.

You have also forced me to think differently. I used to try crazy things, and I lost money for several years. Now I always think, "How would I explain this trade to Tim?" And sharing a journal of monthly wrap-ups, too -- these keep me accountable. And I have done very well since.

Having a friend to talk trading with has made all the difference.

We are talking about some serious money. $10,000 gain in my trading account and $70,000 improvement in my retirement account.

So if I harvest a bit to travel down to Texas in the next year or two, with a case of 12-year old Macallan and a few tins of 10-year old McClelland, you're just going to have to deal with it. I'll buy us a table full of crawfish, too.
Wow, man, glad to help. I hope to catch up with your success. I too, am enjoying learning, and find the analyses and strategies very interesting.

I listen to very few of the after-market sessions, but try to catch the pre-market ones when I'm home at that time. I like some of the analysts better than others, but they're all experienced and smart. Watch for sessions that are hosted by, or that feature, John Gagliardi. I always just sit back and listen to that guy talk, and take notes.
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Post by Del »

My long call on SPY closed at the opening bell with a $23 gain.

This was a good trade that didn't quite work out as planned.

A very good experience, though. I learned a lot from this.
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Post by Del »

10:52 am: I rolled the calls (upper leg) of my condor on RUT down to 1875, just above yesterday's opening high.


The RUT index is currently trading at 1827. I don't expect the index to suddenly recover 50 points (+2.75%) after the Fed meeting this afternoon. If anything, it is likely to drop some more.

The options expire at the end of trading today. I received $472 in premium -- pretty much what I could have made, had I closed my SPY option at Friday's close or Tuesday's opening.

If today's market proceeds as expected, I will be in good shape.
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Post by sweetandsour »

Del wrote: 02 Nov 2022, 09:07 10:52 am: I rolled the calls (upper leg) of my condor on RUT down to 1875, just above yesterday's opening high.


The RUT index is currently trading at 1827. I don't expect the index to suddenly recover 50 points (+2.75%) after the Fed meeting this afternoon. If anything, it is likely to drop some more.

The options expire at the end of trading today. I received $472 in premium -- pretty much what I could have made, had I closed my SPY option at Friday's close or Tuesday's opening.

If today's market proceeds as expected, I will be in good shape.
I'll be watching this afternoon to see where SPY goes. I'm toying with putting in another buy limit order at 375, but will probably wait and see, first.
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Post by Del »

sweetandsour wrote: 02 Nov 2022, 09:28 I'll be watching this afternoon to see where SPY goes. I'm toying with putting in another buy limit order at 375, but will probably wait and see, first.
I prefer to buy when the market is already moving up.... rather than "catch a falling knife," as your buddy says.

Both of my trades today -- closing the long call on SPY, and rolling down my bear call spread on RUT -- are bearish trades with a very short-term outlook.

Your proposed trade -- buying SPY at 375 -- expects the market will hit the mark and then rebound up. I don't have any bets on a quick rebound.

I still see a cup-&-handle forming on SPY. I am considering buying another long call after a couple of up-candle trading days. I might even wait until it breaks through resistance at 390. A lot depends on what the Fed says today, and how the market reacts.
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Post by sweetandsour »

Del wrote: 02 Nov 2022, 09:47
sweetandsour wrote: 02 Nov 2022, 09:28 I'll be watching this afternoon to see where SPY goes. I'm toying with putting in another buy limit order at 375, but will probably wait and see, first.
I prefer to buy when the market is already moving up.... rather than "catch a falling knife," as your buddy says.

Both of my trades today -- closing the long call on SPY, and rolling down my bear call spread on RUT -- are bearish trades with a very short-term outlook.

Your proposed trade -- buying SPY at 375 -- expects the market will hit the mark and then rebound up. I don't have any bets on a quick rebound.

I still see a cup-&-handle forming on SPY. I am considering buying another long call after a couple of up-candle trading days. I might even wait until it breaks through resistance at 390. A lot depends on what the Fed says today, and how the market reacts.
Well, today was a little odd. Talk about a delayed reaction to the Fed, or whatever. I'm glad I didn't put in a limit order for 375, it would have filled and gone right past it, if that's the way it works. Anyway I got busy this afternoon and missed the end of the day's trading. Tmorrow morning's briefing will be interesting, but I plan to be on the golf course, God willing.
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Post by Del »

sweetandsour wrote: 02 Nov 2022, 16:35 Well, today was a little odd. Talk about a delayed reaction to the Fed, or whatever. I'm glad I didn't put in a limit order for 375, it would have filled and gone right past it, if that's the way it works. Anyway I got busy this afternoon and missed the end of the day's trading. Tmorrow morning's briefing will be interesting, but I plan to be on the golf course, God willing.


The Fed announces the new rate with a press release at 2:00 pm. The press release follows a standard format, and the traders look for the small edits in the text for clues to the Fed's outlook toward future rate actions.

Then at 2:30, there is a press conference. It begins with a prepared statement, followed by Q&A with the Board members. There is often volatility during the Q&A, as traders learn what the Board members are really thinking.

Unfortunately, I was watching the market as this happened. Boy, did I make a mess of things.

I bought another call on SPY as the market surged with initial excitement. SPY climbed back into its channel, and I reckoned it would bust through resistance in a day or two and take off. I bought at the top of the surge, near 386.5 --then the bottom fell out.

I bought a second call at the end of the day, when price movement slowed a bit near 375.

I am now (gulp!) $1000 in the red on SPY. I will break even if and when SPY returns to 384 or so.

I just need to let the bears get done ravaging, and wait for the bulls to come grazing back.
=============================================

My condor on RUT had plenty of room, so I didn't have to make any adjustments on the low side. It got close, but not scary.m Expired today... a great week for this condor. Total premium was $1800 on just $6000 at risk -- that's 30% return in one week! And I didn't have to run for cover in today's volatility. This was a grand-slam home run.

I sold low-side puts for next week's condor at bottom, end of today. $328 premium on just $3000 at risk, and I haven't sold the upside calls yet.

I hope it goes up some tomorrow and I can sell calls out wide too. With so much at risk in SPY, I don't want to get dangerous with the iron condor.
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Post by Del »

22 million shares of SPY traded yesterday during the 40 minutes that Mr. Market thought the Fed would ease up on their rate hikes.

So I'm not the only idiot who got caught up in that.

Small comfort.

It looks like the bears have finished feasting and hauled the carcasses into the woods. Bulls are slowly grazing back into the market this morning.

Tomorrow's employment news might spook them, but I feel that full employment and its effect on rate hikes is already priced in with yesterday's panic. The market might zoom if a degree of higher unemployment appears, but I don't expect to see that.
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