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There have been too many people starting - "this is the top" threads. Now we can add Dan's "predictor system" to that list too :p

Although I'm no expert in double diagonals / straddle-strangle swaps, I've done some work with them. Why would you want to trade them close to expiration - to increase probability of landing on the short strike? If you go out in time (say post expiration week), then you may be able to collect...

What I meant is that there are way too many variables affecting stock prices - supply/demand, liquidity, derivatives activity, elections, bubble, fundamentals, media etc etc... ... and fundamentals is only one of them. Hope this clarifies. :)

There was a post by Restricted in another thread where he referenced the following article by Bernie Schaeffer: http://www.minyanville.com/articles/index.php?a=11413. Check it out. IMHO, gone are the days where the fundamentals determined stock prices.

Looks like we've come a long way since this thread started. Time flies, right? (pun intented) :p I had to ask this fundamental question in the current environment: Are we getting paid enough for the risk we're assuming from selling call spreads? It's not the low VIX levels that...

Overbought can lead to more overbought. Better to trade with the trend. Chilling article from Schaeffer indeed.

I'm not as sophisticated (yet) as Riskarb, Maverick or Mo, but will try to answer your question with an example. The following was written by Tom Preston of TOS in the Monkey Brains blog, during the May sell-off: "My VIX options aren't working!! posted by: Tom Preston on May 22, 2006...

I think part of the dropping of VIX can be attributed to the weekend effect. It will pop back to 11+ on Monday if nothing else happens.

Not to forget... slippage and commissions. I've heard Dr.J on CBOE TV mention this on Friday episodes that market makers lower IV on Friday (starting from 11am) to synthetically move time (I think Mo quoted "IV is synthetic time"). And IV usually pops a bit on Mondays to usual levels, now...

Can you please explain "2-3 credit profit"? Is it that you exit if the position now is 2:3 risk-reward? Thanks, tplast. I didnt put on put spreads either, for the same reason - and this has happened for the past 3 months. So decided to not to try to "time" these things any more and instead...

I just closed the exact same spread today that I had rolled into from the 1360/65 before the rally yesterday. Rolled to the Nov 1400/05 for even. Cant take any more chances with this thing.

Hello tplast, Fully agree that CTM verticals have a better risk reward than far OTM verticals. However, what has been keeping me away from them is the fact that when CTM verticals go ITM, theta works against these spreads (there is lesser and lesser time for the market to go OTM again)...

..... so that more people can step-in and buy

We cant have anything more than a 5 SPX point pullback.

If you're trading options, TOS is the best - no doubt about that. Great service, excellent platform, they do everything they possibly can. Wonder why some of these guys here are negative about TOS. As long as they care for the customer, anyday TOS. I used to trade with IB before and got only...

Dan05's latest DJIA "prediction" was posted yesterday. Just scroll up a few posts. (I dont know how to link to his attachment, else I would've posted it here). According to his chart, the Dow should be around 16000 today. But its at new highs instead - this is not even a possibility in his...

Well, even if they've been artificially driving it up the Dow, havent they been doing it for days? If I understand correctly, this system should have taken in that information to "predict" outcomes. So markets are random. Just way too many variables to predict anything. Take oil sell-off...

Only one - this system is nuts (atleast when it comes to swing trading)

The SPX "prediction" line is just horizontal whereas the other markets seem to be dropping a little bit. Also as Karl pointed out, your system keeps changing the range drastically everyday. Maybe its good for intraday trading, but looks like position trading is impossible with that system.

So even you've given up with your system and its "prediction"? How does your system look today?