Weinstein Trading and Fading

1-6-14

I didn't think much of today's trading. I ended the day with slightly fewer shares of (CSIQ) short and less puts options as a hedge. I did manage to close out a small gain from the puts and stock as I traded around the position, but I continue with an unrealized loss. On the plus side, my average cost basis is higher now, although not enough to account for the rise in shares.

(CSIQ) should fall tomorrow and that gave me the conviction to hold steady. After three relatively wild days higher with declining volume and a lower close than open, I expect another test of sub $35 on Tuesday. Absent (GS) buy rating for (SCTY), it's hard to imagine (CSIQ) having the opening it did. (SCTY) closed near the low after moving lower than the open as well, so profit taking may keep the space from lifting all boats.

My cost basis for the (CSIQ) put options is the same, although I did buy and sell a few contracts today. It sure didn't take long for option liquidity to dry up. Volume overall for the stock is drying up too. After trading over 7.5 million shares Thursday, and over 5.5 million on Friday, today's action was much closer to the 30 day moving average of about 3.4 million shares at 4.6 million.

If I was more aggressive with trading it today, I would have been a great day. The moves higher and lower, and then back higher again work well for scalping around a core. Still, it wasn't bad, although hindsight sure makes it all 20/20. Anyway, expect (CSIQ) to fall on Tuesday. Any move higher and I will fade it as the odds begin to stack in my favor. I will also gain some premium decay, although not enough to really matter much yet.

I traded (FONR) with a Michael signal and while I had a small realized gain, it moved against me and not wanting to carry it over, I exited near the closing for a loss.

(NBIX) was a quick hit and run short in after hours when it popped to $15.74 for the first time. I covered at $15.51 with only one lot traded for a small gain. I had size above $16 which didn't happen.

(CSIQ) 40

(FONR) - 319

(NBIX) 23

- 183
 
1-7-14

I want to say it was a mixed day, but really, it just sucked any way you look at it.I've traded (CSIQ) horribly for the past couple of days, always trying to get a "litle more" out of it and holding my short. Today, the company announced a significant sale and my rather large short was hit in the head.

I tried to work the position, but I just didn't have the stomach to hold what I felt would turn into a good fade. I added size via options to limit my downside (somewhat) and started to move from my stock short. My computer said to short above $38 and fade it, and had I not already been short or as short as I was, it would have turned into a nice trade.

I'm still very short and while my average cost basis continues to rise, I have rolled up my put hedged also. Basically, there isn't a lot of profit I'm expecting and I'm just managing the trade for damage control. At least the amount of loss will be quite small if the price breaks lower and closes under $38. As a rule, after three and then after five days is the sweet spot to fade a position when looking at it from a swing trade.

That means the odds don't tilt back into my favor in a strong way for a down day until Thursday, and more accurately, down in a week from now. In some ways that's not all bad because if (CSIQ) is trading about the same or slightly less a week from now, the option premium decay will greatly work in my favor. Today is the most I've been hedged and have contracts on all the lots

The good news is that the hedges I closed out offset the stock appreciation and I did manage to have a winning trade, albeit small today with (NBIX) With any luck tomorrow will be a good day, but if not, I will start to unwind the (CSIQ) trade further.

(CSIQ) - 3133

(CSIQ) 35P + 314

(CSIQ) 38P + 743

(NBIX) + 44
 
1-8-14

Today was a turn-around Wednesday and while I closed a loss with (CSIQ), I was able to meet my objectives, even if I didn't try very hard. I covered over half my (CSIQ) position without scalping it at all. It would have helped, but I used the movements to work in and out of several option trades.

I had a couple of smaller trades and one half way decent one to make my day much better

(APOL) + 49

(CSIQ) + .385

(CSIQ) 40C + 96

$CSIQ 45C -7

$CSIQ 35P - 6

$CSIQ 37P - 76

(FLIR) + 41

(M) + 66

(FVBD) + 208

+ 758
 
1-10-14

It was a busy day with several near enteries that didn't quite get there. i also traded (ICPT) again and while I used greater size, it was still nano bites. I had no desire to expose myself to a $400 stock that may go nuts and reach $800+. When so much emotion is at play, you really never know how far it can go. Anyone who wasn't too quick to take gains were certainly happy with today's result. Unless of course you were a short and thought you would hang on until it settled back lower. Shorts were crushed and I can't even imagine what must go through someone's mind when they see a stock is gapping over $100 against them. The first 10 minutes certainly has a short covering squeeze feel to it.

When it comes to short selling, the second mouse gets the cheese unless it's a news related crash event. I wasn't much of a second mouse as I started fading at $399.35, only to watch it move about $85 against me. I started slow though, and didn't add "size" (joking) until around $470, when I hit it relatively hard.

That may appear to be a lot of punishment, but considering it opened at $370ish, that's about $30 above the starting line. I would love to see it have another up day on Monday as i will look to short overnight or enter premarket on Tuesday.

(CSIQ) moved against me but my option hedge and overnight time decay managed to account for a .75 Delta hedge. A down day on Monday may get me out of the trade depending on how far lower it moves. Of course an up day may as well or at least further progress.

I made a bunch with (TSLA) and then gave it back. I was buying "lotto" tickets, aka out of the money put options that can pay off nicely when they hit. Today wasn't my day though, or at least the second time around wasn't. The (TSLA) $46 put was a mistake and I exited as quickly as I could while avoiding paying the spread. Avoiding the spread sometimes costs me a lot and I was ready to pay it, but this time it worked out halfway decent.

The (ANF) trade was based on a call out from a chat room and the selling weakness of the moving averages. I was stopped out after not getting a full fill.

The rest of the trades were standard fare and I played with (GALT) again. That sure was a mover today.

(CSIQ) 32P - 7

(TSLA) 41P 10

(TSLA) 42P -42

(TSLA) 46P - 9

ANF +3

CSIQ 17

(FRAN) 141

(GALT) 270

(ICPT) 162

+ 540
 
1-13-14

I thought today would be a ho hum kinda day, but it was anything but. I wanted to spend as much time writing as trading, but (ALNY) changed that, along with (FMI) and (CSIQ). I had other trades too, after all, it was a good day,however, those three took most of my time.

I entered (ALNY) at $96.54 as my starting point for a Brenton fade and watched it move above $112 to my partial horror because I faded it the whole way. I slowed down at $105 when my PnL started to concern me. I had visions of the 60% increase stock moving to 80%+ before breaking. I didn't think it wouldn't break, only that it would happen after I had to leave via the emergency exit. At $110.98 I added again, but stopped using full lot size and started to scalp it. It was tough to do because I really wanted to add size, it was such a beautiful short fade, but I didn't want to risk it moving $20K or more against me. So I covered at $110.12 for a per trade gain of 86 cents while also banking a realized loss of about $250. I covered more at $104.78, still above my average basis, but was able to add again at $106.96. I basically did this over and again from $110.10 down to $104 before finally taking real gains at $101.53 (my average was over $102).

I traded around my basis until it finally broke and was able to close out with the below gain. My best exit was over $5 per share. Had I been more aggressive this trade could have been a LOT more profitable, but I'm happy that I kept the risk as low as I did. I was slow adding relative to the schedule and that made the difference between a stress bath and a profitable trade with my attention, but not beyond.

(CSIQ) broke down today after opening higher. It broke down a little further than I wanted and because I'm over sold in contracts relative to my shares short, the Delta caught up to me and I wasn't making any ground with fear that I could wind up net bullish. I guess I'm already net bullish because I wouldn't mind if the shares move a little higher, although I'm ok with where they are now.

I covered some shares and an options contract as I wind the trade down further to a smaller size. The position is now longer fully Delta hedged based on my short puts, but after adding in my long out of the money puts I come close.

I had a couple of other fast trades including (CLDX) for a quick trade off a Brenton signal. (FMI) was another Brenton and (MCK) was an odd lot short based on a Michael short at the moving average.

(CSIQ) 37P -55

(ALNY) + 688

(CLDX) + 50

(CSIQ) + 26

(FMI) + 173

(MCK) + 6

+889
 
1-14-14
I took a few arrows with (CSIQ) today. I was near breakeven and even looked at exiting early in the day. In fact, I started closing out some covered puts, but I didn't cover the shares. So I was left with a full upside loss (I still have a couple options) and it was a tough day. I tried to scalp my way through it, but with a move of 11%, it wasn't easy.

My cost basis is much higher now, over $2 more and if it moves strongly to the downside yet this week I will be in good shape. At the end of the day, I added more shares to my short and sold January $39 puts against the shares. I now have $37s and $39s as partial hedges. The Delta is somewhat low, so I will need some favorable price movement or I will likely exit with a loss and move on.

The rest of the day was decent..I had a nice trade early on with (OPTT) when it gapped higher in premarket on news that was less than stellar. I really smacked that one hard because I couldn't ask for much more out of a setup. These just don't come along often enough.

I traded (DDD) via options and did alright. My PnL posted is higher than it will be. I don't know what the commissions are and while I could have shorted via stock, the options allowed me to mitigate my risk level. I thought I would get more out of (ANV). There are buyout rumors that appear to have zero creditability, but the market likes it, or maybe it's just a dead-cat bounce after such a large sell-off. My guess is that it is a planted story by someone long and stuck trying to find an exit.

(CLDX) was ok. I screwed up my exit so the gain wasn't as good as it should have been.

I traded (CTRL) a couple of times including once on a Brenton/William signal and once on a William signal. I was so busy with the CSIQ trade that I didn't put on more size with CTRL on the second kick of the can. The second go-around is usually rock solid and I could have placed a lot more size.

(CSIQ) 37P + 15

(DDD) 85P + 100

(ANV) + 50

(CLDX) + 46

(CSIQ) - 947

(CTRL) + 198

(OPTT) + 859

+ 300 ish after expected transaction costs from options
 
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