"all-in" is not a word used by responsible professional traders..this word is only reserved for gamblers
I am looking for a break of megenta trendline and resistance of SPY 155 to confirm the turn of the intermediate-term trend. Untill that happens, my view is that we are in the weak uptrend and the pullback this morning is corrective.
I am a DT too but your "all-in" kind of surprise me. what is your edge on this trade? there's only 3 possible outcome market go up, down and sideways and you lose big 2/3. I hope you hedge a little.
Agreed, but my estimate of probabilities is not 1/3 each. Also, I fully realized that market could go up after I entered the trade and then decline to my point of entry at some point before expiration where higher ivol will fully or partially offset accumulated negative theta. My estimate at the time of the trade was that odds were significantly in favor of lower prices or same prices with higher ivol in the next 30 days; so I took a plunge.
I got out of the option trade this morning (trade screenshot is below) for 9.25 pts gain before commissions on 15 contracts: Bought at 20.75 Sold at 30.00 The reason I got out is that cash market opened at resistance with a significant gap down; therefore, the odds were high for some kind of rebound. In addition, I did not want to stay with the options trade over the weekend. Unfortunately, I didnât trade the rebound as I was tied up in meeting at my regular job, and did not want to trade from a phone. I will provide account summary over the weekend. I will be back to trading futures next week, done with options until volatility goes down.
Midday Update 2013.04.08 SP500 is in downtrend based on 30 min timeframe. My view that the pullback that started at the market open on Friday provides good shorting opportunity. I am already short futures at 1,546.50.
Nice job on the recent EQcurve. Take a look at the 60M, the downchannel from 4/4 is already broken--> sideways...upwards. The 4/4/ channel 'broke' at day end of 4/5. (I only use 24 hr charts ES for the channels however = different perspective)