Since my last post, I've added three more May 1410 calls (one for 15.75, and two for 14.50) for a total of four with an average price of 15.43 . I've also added one more May1430 Calls at 5.75 for a total of six with an average price of 10.99 on those. However, a few minutes ago, I've just exited one of the 1410 calls for 18 (from 15.43) and will take home the 3 remainder. Thus, I'll be taking home 9 calls and 1 May 1440 Put.
ES Journal Archive (2006 - 2008)
- Thread starter Buy1Sell2
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Wow. A narrowing wedge and diverging indicator! Does it mean that 1350 is around the corner?
ImPO, looking at that formation it would be pretty reasonable to expect lower lows now, where it will stall I have no idea, but based on average retrace range off that D I would say 1350 would have been my primary target if I was to make a trade off that chart. Monthly chart remains bearish ImPO.
Buy1Sell2 considers that chart as bullish still as reaction lows that are of key importance (to him & others) remain intact. But I think before (beginning of this journal) he would have scaled into a short position looking at something like this, now he follows a trend, hence he is still bullish, please correct me if I am mistaken.
Thanks for your explanation. I wonder though if anyone has done any deep research regarding UP wedges, and what is their accuracy in predicting a break? Also when they do break, what is usually the size of the move in relation to the length of wedge (from bottom of wedge to top)? Does it retrace 50%, 75% etc. of the entire wedge? Please don't hesitate to share with us if you know the answer.
Have a look at this. When Gold went up to current highs stock markets sold off, I see Gold as a buy here & S&P stalling kind of suggests a recall of what happened last time round ie Gold up & stocks down.
P.S. In the land of histogram, this exact pattern is the King Cobra, long all the way baby
(multi-day format)
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1928822>
P.S. In the land of histogram, this exact pattern is the King Cobra, long all the way baby
(multi-day format)<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1928822>
True, I'm not saying anywhere that selling options is better than buying options. If there was an edge, there would be arbs in there making sure that prices moved back to equilabrium.
I was just saying I would prefer time decay to work for me not against me.
When I buy options, its usually because I think VIX is moving significantly higher in the next week or so.
Thanks for your concern, but I am not overconfident. I've been trading options live since summer 2001. (1999 I started paper trading and was able to hold my own during the bear market)
Kudos as again you made some nice trades today. I think its most important to be comfortable in your system...so if your more comfortable buying options then by no means change.
When I see your position, I immediately think I could replicate this position by selling options and let time decay work for you.
Instead of buying 3 more (end of series) May 1410 calls, you could easily sell 3 (end of series) May 1440 puts or higher and get a few points of premium time decay.
You do however expose yourself to theoretically unlimited risk. You do sometimes take a big hit with option writing, everyone remember my posts on BSC and how I was short 30puts (cash covered).
Good trading.
jag
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