Overbought SPX

[Steven Place]

Market’s up 4.5% in a 5 day period, that doesn’t happen often and it means we are overbought here.

I expect sideways action so we want to look at bear call spreads instead of a put buy strategy.

Here’s the trade:

SEll to open SPX Oct 2020/2025 Bear Call Spread @0.80

Add to the trade at 1.20 and 1.70

All out at 0.10

The bid/ask spreads are stupid wide so make sure you use limit and not market orders.

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[Steven Place]

Filled .90

[Roger Kimball]

filled .90

[Steven Place]

Offering 1.30

[Steven Place]

Filled 1.30

Bidding to close this round @0.90

No more adds today, not willing to go full size all in a single day’s trade. If SPX continues to rip, my adds will be on higher strikes.

[Steven Place]

Filled on third round at 1.70, will close out this third add at 1.30.

• This reply was modified 10 years, 7 months ago by Steven Place.

[Steven Place]

Nice dip in the market.

Closing out the third round at 1.20.

[Steven Place]

Exiting second round at .80

[Steven Place]

Will re-add 2nd tier at 1.40 and 3rd tier at 2.00

[Steven Place]

Filled on 2nd tier again at 1.40, will close at 1.00

[Steven Place]

Bidding 1.00 on 2nd tier on the open.

Edit: Filled

• This reply was modified 10 years, 7 months ago by Steven Place.

[Steven Place]

Here’s the action so far:

Entered Tier 1 @ 0.80

Entered Tier 2 @ 1.30

Entered Tier 3 @ 1.70

Closed Tier 3 @ 1.20

Closed Tier 2 @ 0.80

Re-Entered Tier 2 @ 1.40

Closed Tier 2 @ 1.00

For a single spread in each tier, that is a max risk of 1120 and 140 has already been pulled out of the spreads.

[Steven Place]

Out Original Round at 1.00

I’m *completely* out of all tiers, will wait for a squeeze higher if I want to re-initiate.

[Author]

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