* buys/covers are marked on the charts in blue, sells/shorts in red *
Good trading today, made two good trades at the open on $SPY and $GMCR and took it easy rest of the day; still made plenty of trades, but traded tiny size, biggest loss was $40ish, no notable losers worth going over.
+700 today
Trade Highlights:
$GMCR +$76 and +$336 on $130 calls
$SPY puts +$100 - caught the morning drop; not played it since the open, very chopping and couldn't read it properly
$DGLY +$66 on a few long scalps
$CCIH bought Nov $20 calls two days ago, sold today +$173
* buys/covers are marked on the charts in blue, sells/shorts in red *
Finished up $200 today; poor trading today, if you take away $OVET trade I'd be in the red
Lessons:
- Avoid shorting into day 1 movers as much as you can
- Dont long random washouts (re $ATHM); buy washouts only on big runners
Trade Highlights:
$HTBX -$137 - Traded multiple times. Initially (and it was the right idea) I was long biased as this was day 1 low floater mover. However it was spready and thin, so I sold my longs for a loss for the most part. Then I revenge shorted it, and luckily didnt let my pride get too much in the way and covered when it tested $6, otherwise i'd be covering at 6.75; I longed and scalp shorted it a few times to make some back; overall avoidable trade. Should have only used tiny size if trading this at all, and only long biased on dips.
$OVET +$500 - "spread scare" lives! picked up a few on the bid mon-tue, and sold toda,y most of what I had
$ATHM -$227 - traded twice or thrice, all losing trades
$BITA +$100 - closed puts position from two days ago;
$SPY +$200 - seems easy when spy is so strong but it didnt have much range to play with today
$DGLY -$2 - overtraded, didnt wait for the best setups in all cases.
$JRJC -$74 - overall traded it ok, bought dips and sold, was up $50 or so ... until Citron hit it and I was long; that erased my gains and then some. Nothing you can do about it, at least the position was small.
$EBAY -$165 traded 100sh at a time, and added when it went in my favour, unfortunately it turned very quickly each time; totally avoidable, should have used 100 shares and not added after a 5c drop
$DSKY +$96 - one of my favourite setups, big push out the gate, then a pull and perk
Quick post to share my lessons trading $SPY options (these are just the rules that work for me, and are subject to change ... Also these rules are general and apply to trading most securities)
I'll be discussing calls here, however same can be applied to puts (in reverse, naturally)
- Buy calls only on dips, not in anticipation of a breakout nor after a big run and consolidation;
Best setup is to buy calls after a quick flush followed by higher lows:
- Always best to wait for a big drop followed by higher lows, this way you have a set risk (prior low) and great risk/reward.
- Always trade options expiring the end of the following week, not the current week (this way you avoid most of the time-value decay)
- If (like me) you pay per contract, choose the pricier options (priced $1 and over)
- Never step away from an open position
