F, D, DF + Punch -- The Journal of Unhommefou

[Unhommefou]

What's up?

This is Un Homme Fou. I have been a long time lurker on this board, this being my first time posting.

I have been watching and trading (real and paper) the markets for some time now. My live trades? Well my losses added up too fast. I have learned that doing strangles on earnings is not always profitable [that is where a large chunk of my losses came from] and that credit spreads with options don't work for me. They work for everyone else, but now for me.

NOTE: If you ever need a stock to break support or resistance, just have me put a credit spread on the other side of said barrier -- the stock will go crashing through in NO TIME! [jk]

After a lot of trial and error, I came up with a system that works for me.

Initial Capital: $3000

Yeah, not a lot, but that is the EXTRA money that I had where its total loss would not effect me.

My system:
*I will be doing swing trades.

My entries will be based on a set of scans that I have setup, the major one being based on the expansion and contraction of Bollinger Bands.

I will also trade retracements of stocks.

Indicators used will be MACD (8,18,6), Bollinger Bands (20,2), RSI (7) and assorted moving averages.

*Once I have a list of stocks for the day, with entries, I normally wait until 1015-1030ish to purchase option contracts on any stocks that hit my entry targets.

*Never stay in a trade over earnings. Bit me in the but too many times long ago.

Since the current capital is low, I will not purchase more than 3 options contracts. I will also be involved in two only 2 trades at the most for any given period of time.

Options purchased will have the following criteria:

.60-70 Delta
No more than a 50 cent Bid by Ask
at least 110 open interest

This is going to be AWESOME!!!

-- D, DB, B + Kick

 

[Unhommefou]

Seems everyone on here is of the opinion that Monday is going to be the "Black Monday".

I have always thought that Market crashes always happened in October, so it'd be real early if Monday were the big one.

Anyway, here is the plan for Monday:

Possible trades to the upside: GENZ, FXP, DUG, BIIB, KV_A

Seems that money is flowing into Biotech and out of oil refiners. I thought it was weird how oil continues to go up, but the stocks of the oil companies are going down.

Trades to the down side: RIMM, COP, BA, PG, UTX, FAST, ESRX, UA, MDR, CSL SIAL, PNRA, GPN, VTIV

I have attached a sample of the type of setups I look for when doing swing trades:

PNRA:

And KV_A:

Can't wait 'til Monday...

 

[Unhommefou]

Of all the possible entries that I had yesterday only two came to fruition: VTIV to the downside, and KV/A to the upside.

However, KV/A did not fit ANY of the options buying criteria that I had setup, so it was ignored.

Got into the VTIV AUG 27.5 Put @ 2.60 * 3 contracts, and I set my stop to the high of the prior day. I do not plan on being in this stock very long [maybe 3 days max], to I set a close stop.

I do have a price target of $23.25 because that is the next level of support [although it is from almost 1 1/2 years ago.]:

For the upside, I am looking at CIG BIIB...and...uh...

*crickets chirping

To the downside, I am looking at CYN UB ITRI AFG CFR SNX ADM R SIAL HAR CSL and VRSN

VRSN:

Wish everyone a good night, and good luck!

 

[Unhommefou]

So, someone called in sick at work, so I had to take over teaching a class. I AM SO GLAD THAT I DID.

Because of the class, I had missed the 1030 time to check for my entries. Almost every stock on my list did indeed hit their respective entry points that I had established.

However, when I finally did get to check them @ 1230, some had retraced back to the close of the day before, and some even went completely in the opposite direction that I needed...

Glad this happened, I would have stopped out of many a trade today.

I did get into BIIB however. Like I noticed yesterday and the prior day, everyone is RUNNING into biotech. It is going to suck when that bubble pops.

So here are my companies:
BIIB 3x5.7 AUG 60 Calls
VTIV 3x2.6 AUG 27.5 Puts

VTIV shows signs of slowing down, so I may just move my stops up to collect [hopefully] as much premium as I can.

Now, although I have a little over 50% of my capital vested, I am still going to look for plays. If I beleive said plays have the potential to work out big time, then I will sell the weaker of my two current plays, and role into these newer ones.

UPSIDE to look at:
CEPH
CELG
GILD
DNA
[yeah, money is movig into biotech like there is no tomorrow]
BRCM
CRL
FXP
DUG
GRMN

*I noticed today that BRCM had showed up in a LOT of people's journals today. If it does not work out for you guys, I apologize in advance

Downside to look at:
FWLT
STLD
WYNN
FLEX
OXY
ACI
MSTR
MDR
VMW
TIE
ANF
CXG
ICE
GRMN

Yeah I am watching GRMN for a possible play to both the up or downside!

Good night!

P.S. I noticed today that the PUTS on almost any financial stock were juiced out of their minds! I mean, the spreads that I saw on UB alone were $1.50 wide.

Whiskey-Tango-Foxtrot chuck!

 

[Unhommefou]

I am going to give it a few days, but is appears that we may be having a market bull rally during this bear market time.

So, I am still in VTIV and BIIB but I have again moved my stops up.

The one thing that sucks about being a newbie trader is also having a full time job to...sometimes it just gets in the way...repeatedly...

Missed out on some great entries into CVX, CXG, ICE, DNA, GRMN, and BRCM. As a matter of fact, I didn't even get to even glance at the market today until 1500

Oh well, there will be entries tomorrow, the day after that, onward and etc so, lemme get out of the past and into the future.

Upside plays:
CELG
IBB
GRMN
BRCM
HOLX
CRL
AMLN
PRGO
RGLD

Downside:
VMW
SD
CXG
QCOM
HLX
OXY


After looking at my momentum scans, I have been noticing a MASSIVE move away from energy stocks. Also, I noticed how a lot of energy/oil stocks ahve been moving either sideways or down while the price of oil/NG continued to hit new highs. Don't know if that is important or not, but it is something to investigate this weekend.


<sigh> Sleep calls...

 

[Unhommefou]

Got out of BIIB Aug 60 calls due to being stopped out. With my type of job [where I end up traveling and teaching a lot], I always set a contingent order of a sort.
In: 5.7 x 3
Out: 4.6 x 3
Total: -1.1 x 3 = -3.3 [$330]

Account value: $2670

Currently in VTIV [On the downside. Furthermore the stock is at support@ $23.70.] and HOLX [on the upside]

Looking at the following for the upside:
GENZ
IBM
HSY
APH

And the downside:
AAPL
USO
TSO
SNDK
VLO
SHLD
ANF
GRMN
EXPE
LM
VMW
MSTR
FDX
MER
LEH
LOGI

Sample of what I am looking at:
IBM

VMW

 

[Unhommefou]

HOLX hit my stop point and GRMN had earnings coming up.

I actually contemplated violating my holding over earnings rule for GRMN. After an hour and some change of thinking about it, I just completely sold the position...something about it just did not feel right.

Which was a good thing, because the stock IMMEDIATELY cratered $2.

Not to mention that all gadget related stocks have been taking an @$$ pounding with no lube during earnings -- EVEN WHEN THEY BEAT!

So, here is where I am

Account Inital: $3000
Account Current: $2670

VTIV = $270 profit

HOLX = $90 loss

GRMN = $540 loss

Account final: $2370

ROI so far (on $3000): -20%

Now, I could have jumped back into BIIB after I sold it it and rode it up to a good profit, but unfortunately my job got in the way again -- this time it was due to training on the road.

It is time to bite the bullet and order another license of the program I am using and install it on my company laptop

Upside possible plays:
OXPS [ironic since I use them for trading]
CRDN
CVH
HNT
CI
NOC

It appears that money is now flowing into Health insurance and defense stocks

Downside plays
BA
DRYS
CL
SOLF
VLO
MNST
MSTR
CVS
ABV
OSTK
VMW
USO
ACH
MER

Get some!

 

[Unhommefou]

So, I no longer have that "extra" money in my account. A medical emergency happened, and umm...I discovered that my medical policy has a VERY, VERY expensive hospital deductible.

So, I am going to continue this journal with "paper" trades.

Also, I am going to start looking into trading futures. I picked up a book and got a chance to read it during my "stay" and based on many of the charts on some of the commodities that I have looked at [that do not have ETFs associated], seems very interesting.

Hell, I didn't even know that LEAD and PALLADIUM were even traded on exchanges...not to mention that the charts on lead look pretty nice.

Also, am learning about FOREX as well. The Australian dollar aint looking pretty right now, but can't jump on anything until I learn all about it.

Time to upgrade my edu-ma-cation

BTW, anybody got some ideas on good books for trading futures?

 

[Unhommefou]

So, I have started trading currencies...at least on paper.

I am currently testing out FXCM, but I am not liking the platform so much right now.

I have looked at some charts and saw that the $CAD/CHF looked like a good buy, but FXCM either didn't support that pair, the pair is not available in demo accounts, or I am just dumb

Did my first every FOREX trade [paper] today. I sold the $EUR/CHF pair @ 1.6097 with a stop in at 1.6200 [the high of the last 24 hour session].

Stocks that I am looking to track for tomorrow's session:

UPSIDE:
GENZ
TRMB
ROK
MAT
OSIP
EQ
WU
TSL
STP
VMW
TGT
PSD
VIVO
CRL
SCOR
CASY
CELG
DNA
SNDK
UA
FFIV
GD
SOLF
ESRX

DOWNSIDE:
HAR
XOM
COP


It appears that Biotech, defense, and drug stores stocks have been on a tear for the past few weeks, and now SOLAR technologies are joining them.

Also, have a long and hard decision, I have dropped the use of volume from my trading. Not that volume is not good, but using the Bollinger Bands plus price seem to working pretty well on their own [with RSI and MACD used to spot divergence]........plus, the FOREX markets don't report volume and back testing my system without volume has not changed any of the results for getting in and out of a security.

 

[Unhommefou]

Got into the OCT 08 35 Call for VMW @ 2x7.7 on the OX virtual trader.

Drug stores and solar are kicking the tires and lighting the fires in this new market.

But the banks, that have been regaining some momentum, are dropping like hotcakes now!!!

Looking at the following companies for tomorrow:

UPSIDE:

FMD
XFML
NEXC
IDEV
AAPL

DOWNSIDE:
PBKS
RAS
CPE
GU
DB
HBC
RWT
DV
MER
ICE


AND THE SEXY TIME BREAKOUT!!!