For Directional traders

Quote from Rob on Business:

Well, Palawan, mercy is on my side today! Even though I was holding calls over the weekend after losing out on making money on Friday's stock movement, and market opened with Katrina howling today, I was quite afraid of a down day, yet 'twas not so. Stock opened up $1.40, much to my very pleasant surprise, closed out my calls a little higher than what I should have closed them out at at Friday's high (at today's high, thank God), and bought 2 puts to ride the day. Unfortunately, I didn't capitalize on the swing - AGAIN, and closed them out slightly lower than purchase price, then stayed flat rest of the day while I was at work. Stock has penetrated resistance and upper Bolinger band on intraday swing, so we're due for a turnaround anytime soon. It sure feels good to be sitting flat on steady profits this week, even though I've still screwed up a number of money making swings.

Good to see things are sailing again for you.

From someone who's never kept any money from this game...
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I'm very glad to hear it worked out for you. Just keep at it and you will keep money from this game...

If you can, just try to pick your spot carefully. sometimes, we don't have to try to capture every single perceived opportunity. i like to pick the ones where i think the probability of making money is 80% or more, but of course that is very subjective and only my opinion. i try not to do anything with the opportunities that are not that promising, eventhough they still might look good.

my problem is the discipline to stick to that. it's always a struggle between my "gambler" side and the rational side every time the markets are open and i have access to my laptop.

today, i think i won the struggle. i saw NFLX and i saw VPHM and could have opened up old positions in them, but chose not to. instead i focused on the SPY position and trying to see it through. this downtrend reversal (to the upside) could get exhausted, and i wanna make sure i get out right away before SPY continues the downtrend it's been doing recently...

i only mentioned this because you're trying to ride the wave both ways. you're trying to be right both times and i think it's very hard as you have to be 100% right. just because i can't do it, doesn't mean you can't but i remember a guy who was making huge amounts of money doing this on RBAK when RBAK was channeling between 140 to 180.

don't know if he was all-talk but he was giving the right figures on the option prices, so he was at least looking them up as he posted the trades on yahoo message board. he liked to sell puts and buy calls when it was on the low end of the trading range and then cash out after a few weeks/months then just buying puts when it hit the high end. he didn't sell calls as he was mainly bullish on RBAK. i never kept up with his posts as i was only interested in RBAK for a short time when i traded options a few times on it. when RBAK finally broke to the downside, i wonder if he lost all the money he made?

and he had a longer time-frame than you so it was easier...

Good luck...
 
Quote from Chagi:

Unfortunately it's not optionable, but as I mentioned in the stocks forum, LOUD recently caught my eye as another potential breakout candidate. Opened a partial position today at $1.01, chart is looking like a high probability breakout candidate to me.
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Good Luck in your position, Chagi. You've been doing very well with your picks and analysis... I hope it continues (forever :) ).

i'm not much of a low-priced stock player as i didn't do so well in the past with them. i've always had fears because they can be easily manipulated, but LOUD looks like it has enough volume to prevent manipulation.

Good Luck.
 
mini-update 8/30/2005:

cut the SPY position by 10 calls...

SPY Oct 22 calls - loss of $250 from the last position that was added. two other positions are underwater...

just woke-up and saw the bad news... should have woken-up earlier, but i don't trade in the 1st hour, anyway. the remaining position is tolerable as far as riding for the next few days, but it still doesn't feel good to turn a profit into a current-loss.

The AMZN-put position (real-time mark-to-market value from yesterday's close) has more than made-up for the loss on this position that was closed but not on the remaining 20 calls.

Good Trading.
 
mini-update 8/30/2005:

Put a call-position on KBH

KBH Oct 75 calls - risk-capital of $3225.

contrarian-play on the housing-crash news of late.

Peace.
 
Quote from palawan:

Good Luck in your position, Chagi. You've been doing very well with your picks and analysis... I hope it continues (forever :) ).

i'm not much of a low-priced stock player as i didn't do so well in the past with them. i've always had fears because they can be easily manipulated, but LOUD looks like it has enough volume to prevent manipulation.

Good Luck.
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Generally speaking, I agree with you on that one. I currently tend to focus much more on lower priced stocks, but I definately do look at average volume before considering trading. As well, it's almost become a rule that I won't touch CND Venture exchange traded stocks (CND equivalent of the OTC.BB pink sheets stuff, though perhaps slightly more regulated?), the only exception to this being CV Tech.
 
mini-update 8/31/2005:

Closed the call position SPY

SPY Oct 122 calls spyjr - closed at 1.85 profit of $50 on 10 calls and profit of $100 on the other 10 calls.

This could be one of the most chicken-sh*t trade i've made in a while as i should really hold, but the markets are too choppy. many reasons to hold as the market looks to be fighting to reverse direction to the upside and today is wednesday, a good day for such reversal movement, but... i'm too chicken to risk capital when a substantial gain has been made on another position.

Peace.
 
Quote from palawan:

10 minutes and chicken-sh*t trade missed out on $200 of profits. current bid 1.95

oh well.... :D
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$1100 of missed profits now as bid currently shows 2.40.

not really complaining about the fact i closed-out a position that kept going up, but i did have a bad judgement.

i was too "giddy" about my profits on my closed KBH position, that i "forgot" that the original position was for 10 SPY calls and that if i wanted to protect profits, i could have easily just closed the 10 SPY calls and left the original 10 calls as a position.

oh well... losing focus costs money.

Peace.
 
Quote from palawan:

mini-update 8/31/2005:

Closed the call position SPY

SPY Oct 122 calls spyjr - closed at 1.85 profit of $50 on 10 calls and profit of $100 on the other 10 calls.

This could be one of the most chicken-sh*t trade i've made in a while as i should really hold, but the markets are too choppy. many reasons to hold as the market looks to be fighting to reverse direction to the upside and today is wednesday, a good day for such reversal movement, but... i'm too chicken to risk capital when a substantial gain has been made on another position.

Peace.
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I wouldn't worry too much considering that you either made a small amount of money or hopefully broke even after commissions, chalk it up as a learning experience.

As for the markets being choppy right now, I completely agree, I might suggest waiting to see a visible market direction prior to taking a position. You might not catch the entire trend, but there is less risk involved if the trend already appears to be established. Picking tops and bottoms is riskier.

The above said, I think that techs are looking ripe for an upwards move. I mentioned on another ET thread that I'm calling for QQQQs to hit about $42 by early October, if I could trade options right now I would probably be looking at the October $40 & $41 calls.

As for my own position, LOUD rallied a bit today, I added to my position at $1.04, still not quite sure whether this one has legs, though things appear to be looking good.
 
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