SPX Credit Spread Trader

cdowis · Feb 28, 2007

An interesting observation on my calendar --

my Mar/Mar5 (quarterly) 144 SPY calendar just yawned. Virtually no change, with the move up in the VIX.

arizonadreamer · Feb 28, 2007

Quote from kalikahuna:

yeah, impossible to get a realistic exit position. But i feel like someone made huge bags of money from selling off the VIX from yesterday to now

I'm tentatively starting to relax the sphincter...but I dont want to spook the market...btw, i put on a RUT 830/850 spread

Yes, the ol' sphincter relaxation.

Why would you worry about spooking the market if you opened a bearish (call spreads?) position?

AZD

arizonadreamer · Feb 28, 2007

Quote from cdowis:

An interesting observation on my calendar --

my Mar/Mar5 (quarterly) 144 SPY calendar just yawned. Virtually no change, with the move up in the VIX.

That's volatility for you.

For those who sold it - it seems that they are doing well. At least for now.

AZD

kalikahuna · Feb 28, 2007

Quote from arizonadreamer:

Yes, the ol' sphincter relaxation.

Why would you worry about spooking the market if you opened a bearish (call spreads?) position?

AZD

the worry about spooking is because of my previous put spreads that went from being 80 OTM to 20 OTM in one day and no way to exit @ a sane price.

arizonadreamer · Feb 28, 2007

Quote from kalikahuna:

the worry about spooking is because of my previous put spreads that went from being 80 OTM to 20 OTM in one day and no way to exit @ a sane price.

Here's to a smooth, spookless ride through expiration.

AZD

dagnyt · Feb 28, 2007

Quote from kalikahuna:

But i feel like someone made huge bags of money from selling off the VIX from yesterday to now

That sounds like your cup of tea, Murray. Certainly hope so.

Mark

Eric99 · Feb 28, 2007

Yep. Murray is quiet. He must be shopping for a bigger boat!

Cache Landing · Feb 28, 2007

Quote from blure2:

Dear Mr. Landing:

In all sincerity, you are one among a small handful of thread participants that I have targeted to read in- depth. Sailing, Maverick, riskarb, to name a few, are several others.

Rally, or, er, ahh, Mr. Mode, had struck a chord with me relative to his, if I may, "channel surfing", approach. His observations seem to have merit.

Thank you for your contributions as well. I most certainly have benefited from them.

Thank you,

Bob

I was just teasing RM, but thanks for the compliments. He and I have many similarities and it's nice to find people who agree with my point of view sometimes. Anyway, best of luck to you.

Cache Landing · Feb 28, 2007

Quote from domestic:

because i care...and i need to make sure i do not get complacent .
yes it takes big balls and good assessments to have been short.

i was also massively short calls too. i had no short puts, just refused to sell puts in the highs. i for one plan on not putting on some careless trades after looking so good now; i implore others who were short calls or the market to tread carefully.

anyway...cache and others, great job!

Lately (today included) the spoos have been trading in very predictable patterns. Yesterday was unexpected but it was much more likely to see a 50pt drop than a 50pt rise. Vols were so low that I couldn't convince myself to sell calls. I bought puts into that and was long vols. Gonna be really hard for spoos to get back above that lower trend line now. A quick run up will find very heavy resistance at 1440, but it is unlikely that we'll see those heights anytime soon. Resistance also at 1410 and 1430. A close above 1410 today might mean that we see 1430 briefly before we continue down toward 1375 over the next couple months. Personally I wasn't counting on the big drop until end of APR so I still expect this to get bought back up a bit.

Vols are now high enough to start considering -gamma again. Any rally toward 1430 I think is a prime candidate for a put diagonal. 2 cents..

Cache Landing · Feb 28, 2007

Quote from Cache Landing:

A close above 1410 today might mean that we see 1430 briefly before we continue down toward 1375 over the next couple months. Personally I wasn't counting on the big drop until end of APR so I still expect this to get bought back up a bit.

As it played out for the remainder of the day it looked like 1407 was the hangup in both directions. Resistance still at 1410 and without any upside catalyst I'm still seeing a drop tomorrow. We'll see if my new crystal ball is right.