LOL speaking of options i was just talking to this guy who i made the call on the ES too early this morning, after i spoke to you about options, and hes the options guy, first thing he points out. SPY 245.5 calls were trading for 1 cent this morning could have risked 200 bucks to make 6k, right when we started chatting about what i did he goes to the options, and shows me that, its definitely time for a vodka after that. Think i need to get better at trading weekly options though when i think a stock or the index is going to make a move, i think that is the ticket to holding, trade the cheap options and it either goes to zero or you make out like a bandit.
My problem with that has always been taking a smart exit... FB missed my closing 2 penny range by 1...159.98
I was talking about exactly that, my tendency is too want to pay for the trade right off the bat, so i meand 5-10 ticks and i probably would have knocked it in half, but he kind of said to me, look if your taking option long shots, take the long shot and forget about it, it either does what you think or it doesnt. Im more than willing to pay 200 bucks for an idea. My thought has always been to piece out of positions but a part of that is because i remeber every single time ive been fucking torched, so i have a revulsion to pain that is some what hard to get rid of. I know that in certain circumstances it makes sense taking a bet with set risk, and just setting it and forgetting about it, its hard to get the size you need in this kind of environment, when you know it could just cripple you. Like if i take an example of why i didnt go long the ES today when it was at 2450 at 10:00 this morning, the logic was simple, i had to set risk below 2447, so every single contract was worth 150 bucks including slippage and commiussions. So if i take 1 contract, and it explodes through 2450 (my initial thought) i got to risk 150 bucks to make 500,(per contract) that seems like reasonable R:R, but that kind of R:R doesnt deal with reality, i know im going to want to eliminate risk on it the second im fully sized in and it does what i thought it would do. So i know if i buy 2449.5 for example, im cutting it in half probably at 2453. Cause if i have 8 contracts at 2449.5 for example, then its like a 1500 dollar loss if we snap through 2447. So theres just no way im holding that, so the weekly options are a no brainer, look at it, say what you think is going to happen, and risk a couple hundred bucks, WHO CARES. Its alot easier to allow something to grind, in an environment like this if i know i dont got to watch it close with a potential 10k loss looming precariously over my head.
Here is how i would have felt if i had taken 2449.50 when i knew ES was cracking 2450 this morning. The bible verse makes it even funnier in the context of things im an ahteist but i this kind of self deception is epic.
Well, when I say smart exit, I mean knowing when to not hold on for dear life after it bounces off a peak and turn a winner into loser. It's why I will trade a spread even when it doesn't make sense from a purely rational standpoint. The short side of a debit spread also sells my greed, stupidity, and irrationality.
Im out now to go blow my -6 dollars, ill get back to emails sometime this weekend sorry guyd, but in the meantime, listen to some mellow beats, and ill see you bright and early Monday morning for earnings season. Thx for the Conversation Beern, Chuck, and VZ. Keep posting, we only serve to help each other, theres no good or bad ideas just keep posting, and we can keep analyzing it benefits all of us.
I just snagged a 162.5 put for Friday on the spike to 163.70...paid .77 Also, I feel kinda bad raining on your bullishness...there was a really clear exit signal on that one, and the s/r would have meant a tight stop. Tough to spot some of the nuance because I'm on my phone on vacation...but that was a super clear top signal on the volume.
Ugh...not in the cards today. Still inside S/R range though. This should print some red tomorrow unless tech earnings releases intervene. Quite pleased to be in this one .02 off it's bottom price though.