entered on august 1st at 1.14 net. judgement primarily based on the monthly, weekly charts. things like IV, skew etc are not considered, can they help? what are the suggestions of adjustments as SPY approaches 175 in the near term should the market go up? how about the opposite if the market moves away? opinions. gn all
I entered a long calendar SPY 171c Aug 02 Aug 16, at 0.57 on 22nd July when underlying was at 169.30. Closed it today, half at 0.90 and the runners at 1.20. It was a directional trade and I was counting on delta to bring in the money. No adjustments planned, had in mind an arbitrary 30% stop and on the upside I would have closed it if price crossed 171 and deltas flipped. Lowest close was 0.47 on 29th July, based on final quoted bid/ask. I closed a HPQ Aug 16 Sep 20 27c today when price crossed 27, had that trade since 23rd July. Long way to expiry for both legs, but once price crosses and deltas flip I'm left with a choice of hoping it falls back before the front month expires or converting it to a vertical, which I count as a new trade. I prefer to take the money and move on. If I have a conviction later for more upward movement, I can always put on a vertical then. Upward movement has been kind to my calendars, but I have a couple of flys in the crapper from the same upward move in the markets, so I might be swallowing a loss on those next week. Didn't want to close on NFP day, will see what happens next but no adjustments definitely. The First Law of Holes "If you find yourself in a hole, stop digging." - Denis Healey.