Please share what you think are you best trading opportunities/ideas right now. I'll start. GAP clothing got slammed yesterday on bad earnings. Take a look at the daily chart. Currently trading at 21.74 pre-market. If this isn't an opportunity I don't know what is. If I bought here I would be looking to exit at 25.00. If it dropped to 15.00 I would probably add more and ride it out back to 25.00 for a long term hold. It's not one for you crazy action junkies out there.
Best Trading Opportunities Q4 2020
- Thread starter ShadowHunter
- Start date
Upside volatility in TSLA is fairly bid from all the S&P inclusion rallying and the calls are skewed. Short interest is low compared to historic averages in this name, and no new potential catalysts upcoming in the near future AFAIK.
One idea is to short some distant upside verticals in Jan or Feb at a strike you think is relatively safe, and underhedge to avoid getting hurt if there is some aggressive profit-taking. I was in this trade a little too early like usual, but it has gotten even more attractive throughout the week imo. I think this earns decently before expiry.
Getting the long risk reversal for a nice credit is also a good opportunity, but with the additional factor of needing a puke at some point instead of tapering off into drift to realize the full PnL.
One idea is to short some distant upside verticals in Jan or Feb at a strike you think is relatively safe, and underhedge to avoid getting hurt if there is some aggressive profit-taking. I was in this trade a little too early like usual, but it has gotten even more attractive throughout the week imo. I think this earns decently before expiry.
Getting the long risk reversal for a nice credit is also a good opportunity, but with the additional factor of needing a puke at some point instead of tapering off into drift to realize the full PnL.
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Looks pretty good on a 1 year chart except for JAN start of $17 + NOV topping tail.
WHATever you do i would not long term hold that one\unless you want to long term average down from $53.
UPRO/SPXL/SPYG/TQQQ /QLD have done ok/2020.
CLIX[long online \short stores] had been doing well, but not so much lately, so GPS could outperform/2020............................................................................Wisdom is profitable to direct.
despite having a maths higher ed I have never got into options. If I wanted to trade a potential move back to $25 on GPS what would be your thoughts on doing this with options buying deep OTM calls long expiry. If I buy 1000 shares here at $21 with no stop thats $21000 exposure, then another 1000 if it dropped to $15 ($15000 exposure), then another at 1000 at $8 ($8000 exposure). I would be interested to see how an option trader would structure the trade for maximum leverage.
Depends what you mean when you say options trader; I am sure some D1 traders would buy calls to pack more notional $$ into the trade for the margin required. But now you are on a timer for the move to occur.
If you are trying to trade the vol, delta neutral, now you need an opinion on whether we are going to realize more volatility than is currently priced into the options. If less you want to be short premium and if more you want to be a buyer.
The further you go out in time, the less this realized / implied spread matters, because changes in volatility will dominate your PnL more and more. So long otm calls far out in time would be the play if you think there will be a rise in implied volatility or call skew.
imo you have a delta opinion here so I wouldn't go into the weeds with options.
If you are trying to trade the vol, delta neutral, now you need an opinion on whether we are going to realize more volatility than is currently priced into the options. If less you want to be short premium and if more you want to be a buyer.
The further you go out in time, the less this realized / implied spread matters, because changes in volatility will dominate your PnL more and more. So long otm calls far out in time would be the play if you think there will be a rise in implied volatility or call skew.
imo you have a delta opinion here so I wouldn't go into the weeds with options.
yes it's a pure delta opinion.
GPS has been sideways, it's still a great RR spot to get in here. I wouldn't rule out a drop to $15 as anything can happen. If I was a short term trader I would be looking for upside confirmation then buying RR dips into $25.
short term traders squeezed CAAS up to $13.5. I am sure $5 will print again in short order but generally I don't like to short as losses are unlimited.
Brent feb21 currently trading 49.12. This will pop to 49.60 next few hours. how do I know? been trading too long guys.
