GRPN BP - earnings went against me
AXAS (this has always only been a naked long because the stock is like 1% from being ITM so a strong E.R. will give me some quick big profits)
Right now, I am really liking HSP and I've had it for over two weeks, but the current price action doesn't look sustainable. ENVI looks like it might break out soon/today hopefully
^^^Was stopped out of GTAT but might try and jump back into GTAT tomorrow for a flip. Potentially a hold if it hovers around it's closing price at all tomorrow.
Anyways, just a short update. I have been trading larger size with less overall positions. Taking advantage of a higher delta and taking (some) profits quicker at key resistance levels. I am not as scattered watching tons of charts so I can read the charts more purposefully this way. I am slowly getting better.
Currently trading NBR mainly. Established a position in EMC to start the day as well.
I put on a diagonal bear call spread on QCOM but don't expect to trade around it for the rest of the week. I bet earlier that it wouldn't break above $67.5 for the week and sold some calls. Bold move considering the price action on Friday but some key resistance overhead that should slow the buyers down. I bought $70 calls that expires in September so I have time to wait for the big move to hopefully come later.
why don't you try and capture theta decay instead, then manage your deltas while in the trade. A home run while the market is consolidating is going to be hard to find, and expensive.
Overtrading options is going to kill you on the slippage.
I have actually been thinking about this too. The QCOM diagonal bear call spread I mentioned is a play on theta decay trade as I got paid for the weekly to expire and I bought the September calls. I am likely gonna sell the August $67.5 that expire this week as well.
I definitely agree on overtrading hurting thanks to slippage. I have almost completely stopped trading $0.05/spread option chains. I still feel like I need to take my set-up based on the underlying chart and be proven wrong, instead of waiting for the overall market to confirm bullishness and potentially miss the trade while waiting for said confirmation. Perhaps I can make my set up criteria more rigid though...
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The following user says Thank You to Big Mike for this post:
I feel like I am maturing as a trader slowly but surely. I don't view my end of day P/L as "Man I made/lost $XYZ today" like I used to. It feels much more like an ebb and flow that the volatile price swings that I used to have. I never get too happy about my profits because I know that it is a coin-toss that I might give a chunk back the next day. I am slowly getting there with my losses as well, but they still feel a little more existential and I get a little "woe is me" at times still haha.
I have been trading a lot less spreads recently which isn't surprising given the market climate but it is noteworthy. The market has been moving higher without much hesitation, so I don't see the benefit of selling calls, even if it is something like a diagonal bull call spread. I am playing stocks that are setting up for a break out anyways so I don't want to put any cap on profits with short calls.
There is some slight psychological stress added to outright calls though With the spreads I trade (different types of diagonals mostly), as long as the underlying stays in a range, I am ok... up/down/sideways are irrelevant. However, with naked long calls I am directionally biased so I am always rooting for rallies. Whenever I see red I get a little angst in my stomach.
One thing I have fully embraced is DITM options. I am trading 1 month (or greater) options with a delta of 0.80 or greater most times. Ties up a lot of capital, but I really don't need those parabolic moves like I used to with OTM options. I don't have to worry about time decay at all really either. The only issue is the occasional gap lower really stings.
The following user says Thank You to Bermudan Option for this post: