Morning fishing the NDX

Discussion in 'Journals' started by options4me, Sep 8, 2008.

  1. Hello to all,
    New to the forum this week.
    What I will be posting will be my morning trades on NDX (NASDAQ 100).
    There has been a very interesting trend that the NDX likes to follow after the opening has settled down.

    First: Just about every time it Gaps open, it will close the gap during the same trading session. Now I do not trade this gap, but I do watch for it to pull back. The gap is used for the direction of what I think will be the trend.

    Second: I look for it to show it's first Support and Resistance points within 30-40 min after the opening.
    This is when I start to act.
    I will place a "Streched" Fib Retracement on those two points to give me my trading targets.
    The Fib Retracements that I use is not the "Normal" setup.
    I start by placing the starting point at the 1st S or R point depending on the trend direction, and then streching it out so the 61.8% line is at the second point.
    This will give me "Targets" at the 38% and 0% lines.
    If it starts to bogg down at the 38% line I will then place an order in the opposite direction.

    I will only do one trade a day, then done for the day.
    I have attached a couple snapshots of todays trade to show the setup.

    Bought 10 .NDYIH (Sep 1875 Call) @3.90
    Sold 10 .NDYIH (Sep 1875 Call) @ 4.60
    Profit for today's trade is $670.04
  2. No trades on Tuesday due to I was road tripping...
    Wednesday I placed a trade because there was a gap at then opening.

    Opened a trade after the first resistance and then support after the gap open. It tapped the resistance 2 times and stalled. Placed my Streched Fibs and I have my exit target set.


    Bought 1650P @ 6.50 x10 (.NDVUM)
    Sold 1650P @ 7.90 x10 (.NDVUM)

    Nice profit of $1370 after com.
  3. NDX options have decent spreads but still not made for intraday scalping. If you went short 10 NQ contracts at same levels and covered later for 20 NQ points, 10 contracts would have made you $4k. 10 NQ contracts with a 10 point stop is $2k in risk which is not far off from what you would be risking buying OTM puts. With the NDX options you have the b/a spread and deltas to contend with and for intraday trading, you might find more profits using the NQ futures and the same entry/exit parameters.
  4. Todays entry. Will be waiting for the rest of the meltdown later today...
    Bought 15 1650p @3.00.

  5. Sell off started...Got out @ 5.00 (+ $2970 for the day) after it broke thru the support line.

  6. I will be closing this journal so I can continue testing a few other trading styles. Even with the market crashing all around us, I have been able to pull of a few profitable trades this week.

    With the NDX Options closing the Sept options today, I was able to get in a Bear Call spread after the end of session run up.
    Just bought 10 1775 Calls @ 1.80 Sold 10 1750 Calls @ 3.0