SPX Credit Spread Trader
- Thread starter El OchoCinco
- Start date
Coach and guys
I had bad day today. Just wanted to share with you all.I had 50, 720/730 Bull Put on RUT for may and took in $0.60 per contract. I was waiting for the bounce and had 2 chances to close it out for $2.20 and once even for $1.80. But i lingered on in hope and closed out at the worst possible moment when the IV was very high. I panicked and pulled the trigger at $5 debit.
I knew all about the rules and managing my psychology but somehow made this mistake.I know i will live to trade another day. Just wanted to share with you all.
I had bad day today. Just wanted to share with you all.I had 50, 720/730 Bull Put on RUT for may and took in $0.60 per contract. I was waiting for the bounce and had 2 chances to close it out for $2.20 and once even for $1.80. But i lingered on in hope and closed out at the worst possible moment when the IV was very high. I panicked and pulled the trigger at $5 debit.
I knew all about the rules and managing my psychology but somehow made this mistake.I know i will live to trade another day. Just wanted to share with you all.
Hi Heather:
Haven't heard from you in a while. I am sorry to hear about what happened.
Similar thing happened to me last summer. Can I offer a little advice. You will now experience a strong urge to quickly get those losses back, but I'd like to suggest that you instead take a month or so off and writeup a new trading plan that meets your personal goals and manages the risk better. I did do this, but I didn't take that month off. I was so jumpy that I overadjusted and lost a little bit that first month.
Just my opinion and good luck in your future trading.
Haven't heard from you in a while. I am sorry to hear about what happened.
Similar thing happened to me last summer. Can I offer a little advice. You will now experience a strong urge to quickly get those losses back, but I'd like to suggest that you instead take a month or so off and writeup a new trading plan that meets your personal goals and manages the risk better. I did do this, but I didn't take that month off. I was so jumpy that I overadjusted and lost a little bit that first month.
Just my opinion and good luck in your future trading.
Well all, today was a true BUKKAKE in teh ass of the market. Personally I think it was an exaggerated move but we had been riding high for some time and a kick in the ass is not a bad thing. I think once we started falling momentum took over and the big boys just kept pushing it lower waiting for the sheep to finally give in and short/sell and then rode it down even further.
Inflation is coming in warm but not economy shattering. Just means the stupid Bernanke/Bartiromo "pause" fiasco was bought in by too many people and they got their come uppance today. If we have one good piece of economic news, the market will be up 150 points
Those of you on the short put side, I am hoping that tomorrow it is relatively flat and we stay pegged around 1270. Then the fear is if we have news on Friday morning which pushes the futures lower and a lower SET. If you are at least 15 points away by Thu close, I think you should not fear a SET, with the CAVEAT THAT ANYTHING IS POSSIBLE....
Tomorrow is your last day for May to either adjust, get out or let it ride. Use your common sense even in the face of a loss. Better to take a knife to the leg then a bullet to the face.
My advice is to let the market settle and do what it wants to do before rushing to jump in on positions.
We have fallen 52 points or so in the last 5 days so put today's move in perspective. It probably was not the start of a crash but a part of the move since the Fed meeting. Lots of bulls for the long-term still exist and today's exaggerated move comes a lot from daytraders and big boys. Let's see the follow through after the past 5 days.
Right now 1265 and 1260 short put strikes are in the danger zone unless the market is up and closes more than 5 points higher. 1255 and below come into play if we have a large down day.
Inflation is coming in warm but not economy shattering. Just means the stupid Bernanke/Bartiromo "pause" fiasco was bought in by too many people and they got their come uppance today. If we have one good piece of economic news, the market will be up 150 points
Those of you on the short put side, I am hoping that tomorrow it is relatively flat and we stay pegged around 1270. Then the fear is if we have news on Friday morning which pushes the futures lower and a lower SET. If you are at least 15 points away by Thu close, I think you should not fear a SET, with the CAVEAT THAT ANYTHING IS POSSIBLE....
Tomorrow is your last day for May to either adjust, get out or let it ride. Use your common sense even in the face of a loss. Better to take a knife to the leg then a bullet to the face.
My advice is to let the market settle and do what it wants to do before rushing to jump in on positions.
We have fallen 52 points or so in the last 5 days so put today's move in perspective. It probably was not the start of a crash but a part of the move since the Fed meeting. Lots of bulls for the long-term still exist and today's exaggerated move comes a lot from daytraders and big boys. Let's see the follow through after the past 5 days.
Right now 1265 and 1260 short put strikes are in the danger zone unless the market is up and closes more than 5 points higher. 1255 and below come into play if we have a large down day.
Commiserations. That's bad luck and very honest of you. Better to experience this and have it burned in memory early on rather than when you've made millions 
Hopefully, you had the ideal hedge in place: limiting the position size/max risk to single digit percentages of portfolio.
It's only money!
Prosperous trading in future.
Hopefully, you had the ideal hedge in place: limiting the position size/max risk to single digit percentages of portfolio.
It's only money!
Prosperous trading in future.
I am sorry to hear about the whipsaw. Days like today are the ones we need to prepare for. Not exactly a Black Swan but the past 5 days are a large move very uncommon and thus sort of like a Black parakeet than a swan.
Seomtimes it is better to determine ahead of time the point at which you will roll the position or get out and try and not get intimidated by huge market moves like this one.
It is one thing to know the rules and it is another to apply then and that is where the true heart and magic in trading lie. we all know the indicators and positions but it is implementing the plan which is the true secret to success. I still have my days where I ignore the logic and let the emotion make the decision and that human side of us will always be there in trading unfortunately. The goal is to make sure that when it does happen, it is a minor flesh wound we can survive and learn from.
Losses are not a personal attack on our character or a signal of our worth. They are just a part of the game, no different than a good hitter in baseball striking out. It does not undo all the good up to that point, it is just a facet of the game and is unavoidable at times. The good hitters just know how to put it behind them and look to the next at bat. Remember the hitter cannot rush to get to the plate again, he has to wait his turn and be patient. Same with trading.
Seomtimes it is better to determine ahead of time the point at which you will roll the position or get out and try and not get intimidated by huge market moves like this one.
It is one thing to know the rules and it is another to apply then and that is where the true heart and magic in trading lie. we all know the indicators and positions but it is implementing the plan which is the true secret to success. I still have my days where I ignore the logic and let the emotion make the decision and that human side of us will always be there in trading unfortunately. The goal is to make sure that when it does happen, it is a minor flesh wound we can survive and learn from.
Losses are not a personal attack on our character or a signal of our worth. They are just a part of the game, no different than a good hitter in baseball striking out. It does not undo all the good up to that point, it is just a facet of the game and is unavoidable at times. The good hitters just know how to put it behind them and look to the next at bat. Remember the hitter cannot rush to get to the plate again, he has to wait his turn and be patient. Same with trading.
Thanks guys. goin out to take my mind off trading. see you in june.
heather, most traders have done exactly what you just did. it will get better though. No one likes taking losses like that but perhaps what you can do in the future is to be a lil more risk averse. There are other ways to trade your expectations for the underlying with alot less risk. Just a suggestion.
I was talking in general, which news are you referring to tomorrow?
Quote from rallymode:
coach, the news comes out tomorrow morning not fri, better close that es swing you got on LOL