Archives for June 2018
[CLOSED] – FXI Put Sale
Update: July 30th, 2018
Closing out the trade for a profit.
Full Time Profits, June 28th 2018 – NVDA, NFLX
What a difference a few days make. Monday led off with a gap and trend down day. We went from the middle of a “constructive” range to test the 2700 level we’ve been watching for a while now.
For me there’s a few scenarios that can play out.
(I’m writing this on Wednesday evening so by the time you get it on Thursday morning we may have more data.)
I think the most bullish scenario would be an overnight gap down and flush early, followed by aggressive buyers. That leads to a hard bounce into Friday and 2700 is regained.
A bearish scenario would be price acceptance into 2700… sideways action is NOT good for stocks here, because it shows lack of aggressive buyers. If that happens, especially through Thursday, then Friday we’ll probably trickle lower. If Friday finishes at the lows, then we’d be looking for a Monday gap down/reversal, similar to the previous scenario.
Some areas look like hot garbage. Financials and industrials come to mind, so just keep an eye on those to see if they really give up the ghost.
In terms of new short ideas, I’m warming up to getting a little more aggressive to the short side, but only after we see more upside price discovery. At these levels, shorting in the hole is a bad idea.
As it stands, a lot of Full Time Profits setups have triggered. There’s not much need to introduce any kind of crazy risk additions. All I’m doing now is updating some setups we had earlier in the month that need new option strikes.
Trade #1: NVDA
Semiconductor stocks as a whole don’t look too hot here. We want to see capitulative movement to retest the breakout area in the high 220’s.
Trade Setup
Expected Price: 226.65
Sell to Open NVDA Aug 195/190 Put Spread
Tier 1: Enter at 0.80, Exit at 0.30
Tier 2: Enter at 1.10, Exit at 0.60
No Tier 3 (Earnings)
Trade #2: NFLX
This is a wishful thinking setup. Meaning I really don’t think that they’ll take it down this far, but if they do I want to be prepared. Earnings are coming up and option premiums are pretty jacked up as it is. Let’s get a flush and get an amazing entry on this momentum stock.
I’m also widening my profit taking targets on this because the bounce into this level should be aggressive.
Trade Setup
Expected Price: 350
Sell to Open NFLX Aug 285/280 Put Spread
Tier 1: Enter at 0.87, Exit at 0.17
Tier 2: Enter at 1.17, Exit at 0.37
No Tier 3 (Earnings)
[CLOSED] – Long Volatility in PFE
Update: July 10th, 2018
Closing out the trade for small profits.
Full Time Profits, June 25th, 2018 – WYNN, GS
After finding 2800, the markets are seeing a pullback.
So far, this pullback is rotational, sideways, and healthy. Buyers are still in control, unless 2700 is finally taken out.
When it’s rotational, that means that some stocks are still looking hot, and then others are trading like hot garbage. Other than that there really isn’t much to say about this market. I’m sure I could spin some tale about trade and tarriffs and China so I could sound really smart.
Let’s keep it simple. Two levels. 2800 and 2700. The longer we stay above 2700, the higher the odds of market continuation higher.
Today, we’ll be looking at stocks that have hit our price levels, but the option spreads need to be updated.
Trade #1: WYNN
WYNN finally got that second push lower we’d been looking for since June 7th. We need to shift the trade from Jul to Aug options.
Trade Setup
Expected Price: 172
Sell to Open WYNN Aug 150/145 Put Spread
Tier 1: Enter at 0.75, Exit at 0.25
Tier 2: Enter 1.05, Exit at 0.55
Tier 3: Enter at 1.35, Exit at 0.85
Trade #2: GS
We’ve been watching this one since May 29th, and looks about ready to head to our price target.
Trade Setup
Expected Price: 221
Sell to Open GS Aug 205/200 Put Spread
(I’m not sure on the pricing on this one, because the bid/ask into the close on Friday wasn’t clean. Ask was way too high so I’m putting a best guess out. If anything, wait for the stock to tag 221 and then figure out the pricing.
Tier 1: Enter at 0.70, Exit at 0.20
Tier 2: Enter at 1.00, Exit at 0.50
No Tier 3 (Earnings)