Weekly Poll: Don't Short A Dull Market?

SPY Next Week?

  • Bullish

    Votes: 25 54.3%

  • Flat

    Votes: 7 15.2%

  • Bearish

    Votes: 14 30.4%

  • I prefer to keep my opinion to myself

    Votes: 0 0.0%
  • Total voters
    46
Quote from tradingjournals:

Are you sure? Is it not wiser to buy the dips?

Double check whether your are walking upside down. :)

Folks: How high will this up leg go?
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Where is our friend S2007S? I hope he got it right. I think he is smart and changed his mind real quick :)
 
Quote from shortie:

looks like the bullish edge is still there for the expration week: +1.5% and it is only Tue
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Did you check how much are the straddles now? I did not have a chance to do it yet. You may want to eye ball what would be the strike that will win on Friday, using your highly developed intuition, and very sharp mind, and all the cool signature with green glasses if you think it will make cash.:)
 
Quote from shortie:

the edge is huge and is amazingly stable over so many years. i really should be using it in my trading. it's great that you actually understand why it works.

is it in the books or is it one of those secret formulas? :)
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This one is not secret formula. It is due to few things (first 2 I read and they make sense, the others are my theories):

1. The hedging of new short puts (the previous post got it).

2. Professional traders do not hold risky assets, and except in a raging bull market they consider a long position as a riskier assets. Therefore stocks they get assigned over the weekend are sold the following week.

3. A short position is better for margining reasons than a long position, so there can be incentive to clip them/remove them and even replace them by shorts.

4. If interest rates are positive, longs are desired less due to cost of carry, and shorts are desired even more because they earn interest. So selling long and shorting is an action that earns TWICE the interest rate.

Points 3 and 4 are mine. Never stated before. What do you think of them? Are they worth the mention in future formal writing.
 
thank you for sharing your knowledge!

my intuition fails me about the straddles. i will watch them through the rest of the week. maybe somebody has ideas where the market is signaling it is going to by expr. if i had to wild-guess i would say that SPY where it is now is reasonably priced (we were oversold and we bounced up).
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I am watching the bonds. There were at 125'18 few moments ago. They did not break 125'17 yet, which important for confirmation purposes. I covered my short bonds, and will wait to see if they will break 125'17. If bonds do not go down, then this up leg in stocks is limited.

126'08 was the precise top in bonds. When "experts" brag about their positions, one may want to watch out. :)

I give you the stamps as a gift, and you may want to get bone to send you more than just bones for the contest. I know you like green healthy food. Bonne Appetit:)

And thanks for the straddle numbers!
 
Quote from shortie:

thank you for sharing your knowledge!

my intuition fails me about the straddles. i will watch them through the rest of the week. maybe somebody has ideas where the market is signaling it is going to by expr. if i had to wild-guess i would say that SPY where it is now is reasonably priced (we were oversold and we bounced up).
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somebody is making a small kill selling those straddles:
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Quote from shortie:

somebody is making a small kill selling those straddles:
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somebody= Shortie? :)

PS: Asking you for those numbers was also an exercise to draw your attention to potential trades.
 
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