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TRADE IDEA: SPY JUNE 17TH 177/181/215/219 IRON CONDORWhen volatility is low such as it is now in shorter term expiries, you have a couple of different choices when selling premium in broad-based market instruments like SPY, IWM, QQQ, and DIA: (a) sit on your hands, waiting for volatility to pop to a level such that less-than 45 DTE setups are more profitable; or (b) look farther out in time for volatility to "regularize" in more time-distant expiries. (Naturally, there is nothing to prevent you from continuing to put on premium selling setups in this environment, but they're subject to the vagaries of volatility expansion, which is the opposite of what you generally want when selling premium). In this particular case, I'm looking to keep setups in queue in the event that this lower volatility hangs about for several weeks and, after looking at the implied volatility for April, May, and June, have concluded that implied volatility in SPY options doesn't begin to "regularize" until the June expiry: April's IV is 17.2%; May's, 18.7%; and June's, 19.9%, after which the IV%-age pretty much hangs around the 20% area for the remainder of the year. Here's the setup: June 17th 177/181/215/219 Iron Condor Probability of Profit: 61% Max Profit: $104/contract Buying Power Effect: $296/contract Notes: Naturally, this is quite far out in time, and a lot of stuff can happen between now and then. Consequently, I like to keep these longer dated setups small relative to my 45 DTE and under setups, so that I don't have a ton of buying power tied up while I'm waiting for the statistical probabilities to play out.
AMEX:SPY
by NaughtyPines
SOLD GDXJ APRIL 31 23/31 SHORT STRANGLEAs with the XOP play, selling premium where the volatility is and that's in gold issues (GDX, GG, GDXJ) and oil (OIH, XOP) right now. I filled this earlier today for a $98 credit. The current metrics are: Probability of Profit: 72% Max Profit: $90 per contract Buying Power Effect: Undefined Notes: At the suggestion of FractalTrader (that you very much for your ideas, by the way), I'm playing around with what I can do graphically here with options setups, so that it's easier to visualize where price has to "sit" for the duration of the setup. If you have traded options before, the vast majority of platforms display a range of prices horizontally, with prices below current price on the left, current price in the middle, and prices above current prices on the right, so it's a bit of a challenge to adapt an options platform view (which only consists of a horizontal "price axis") to a candlestick chart. In any event, this is a short strangle, so I want price to remain between my two short option strikes for the duration of the trade -- above the 23 short put and below the 31 short call ... . I'll look to take the whole setup off at 50% max profit.
AMEX:GDXJ
by NaughtyPines
HUGE SELL OFF SELL SELL SELL !!! (ECB NEWS)So as most of you already know it is March The 10Th Which is the date where The ECB come out and speak about Monetary easing, Inflation and Rate cut What am i expecting ? Well as a mainly technical trader it is in my job description as a full time trader to look at Both technical and fundamental in the market. After heavy research into the Fundamental side of things i Believe They will launch a round of Monetary easing or Deploy a Rate cut Why do i think this ? Well Firstly We all have to look at the bigger picture how is the economy doing ? Not so good Top two economies are declining (US and Chinese) In regards to the EUROZONE it is looking even worse especially as many of the countries in the EU need bailouts and are suffering from current economic situations E.G. Greece Italy Ireland All of which are in the euro and are in great trouble Anyways many Investors predict a huge sell of for the Euro as many believe they may be willing to bring out the big News and expand its aggressive quantitative-easing program, introduce a two-tiered deposit system and offer cheap loans to banks. If so then expect a huge decline in the Euros currency as There is a huge imbalance in the Euro at the moment The question why are the ECB doing this well they are taking any drastic measurer to boost eurozone economy and like the ECB boss, Mario Draghi who said the central bank was “ready to do its part” to boost growth and inflation. Fading growth and inflation prospects will force the European Central Bank to review its policy stance And make a change to hellp its growth which of course is its main problem inflation prospects have turned for the worse, raising a credibility issue for a bank that has undershot inflation for three straight years. Which is a big worry So when you put all these factors in based of Fundamentals what does it mean well really nothing until draghi comes out and says it himself and launches Monetary easing or Rate cut's But if they do decide to go ahead with it expect a huge sell of :) For all EURO pairs What do i See based on Technicals ? Well a good thing that supports the sell of is we are below a key level of 1.1000 which is also a nice round number physiological Levels ;) Also after the big rally In February we have almost completely corrected ourself which many traders didn't believe would happen as many thought we would break the consolidation zone we have been stuck in after such a nice bullish move But once again with the EUR/USD price is undecided We seem to be bounce of our key level which also helps in a bias to the downside Anyways This is my view on the EurUsd trade safe guys News is very unpredictable expect the worse and i hope i didnt bore you to much lol Thanks for reading happy trading lets make some pips !
Short
by ARFXC
34
IUX/RUT 80% POP FEB 29TH 895/905/1050/1060 ICWith a paucity of meaningful earnings plays to work this week and having exited all of my Feb index plays, I'm looking for something short-term to bide my time as my core March index setups work themselves out. I'm not yet ready to move into the April monthly (it's still a bit far out) for index setups, so a short duration, high probability setup is a good way to keep engaged without tying up buying power for substantial periods of time. The setup metrics: RUT Feb 29th 1740/1750/1965/1975 Probability of Profit: 82% Max Profit: $98/contract Buying Power Effect: $902 Notes: As you can see by the metrics, the probability of profit is great; the risk-reward is not. As with all setups of this type, there is typically a trade-off between probability of profit (which generally requires a wider setup) and your defined risk, which represents the max loss you would experience if you allowed the setup to go to expiration without doing anything in the event of a test of one of your sides ... . All that being said, I generally treat these as scalps. Although I shoot for 50% max profit for the setup, I usually look to get out of the trade for a smaller profit if that 50% max isn't fairly immediately realized.
I
by NaughtyPines
Short on EUR/NZD SELL SELL SELL Overall bias is Bearish -Firstly we have bounced of key level of 1.7000 -we have broke trend line based off 4 hour time frame -We had a small retest -I do believe we will break previous lows -Previous four hour candle was a bearish hammer -A lot of wicks to the upside Off the daily -We can see huge wicks to the upside on the Ket level -Yesterdays candle was a bearish engulfing -We also had a triple top so overall i am bearish on this pair All the best
Short
by ARFXC
1
RUT/IUX MARCH 31ST 805/815/1060/1070 IRON CONDORWith the highest implied volatility out of the four indices (S&P, Dow, Nasdaq, and Russell 2000), the Russell 2000, RUT or IUX (symbology will vary by platform, apparently), offers good premium selling as an alternative to playing its ETF counterpart, IWM. Given the value of the underlying and its accompanying options, having more "meat on the bone" allows you to go wider with your iron condor, increase the probability of profit of the setup, and still get something for your trouble (the only way you can do that with IWM is to increase the number of contracts involved). While I ordinarily place the short put side of my index ETF, SPX, or RUT iron condor setups at one standard deviation out (84% probability OTM), here I've gone somewhat out to the 94% probability OTM strike for the short put; on the call side, I ordinarily set up the short call at the 75% probability OTM short call, but here I've gone out to the 80% strike. Here's the setup: RUT/IUX March 31st 805/815/1060/1070 Iron Condor Probability of Profit %: 73% Max Profit: $210/contract Buying Power Effect: $790/contract Notes: Look to take the entire setup off at 50% max profit and/or balance the setup's fairly delta neutral disposition by rolling sides in toward current price if you've still got 25 days or more until expiration ... . I put something like this on last week while waiting for my Feb SPY IC's to finish out, but neglected to post it here ... .
I
by NaughtyPines
PCLN -- FEB 26TH 947.5/957.5/1212.5/1222.5 IRON CONDORPCLN announces earnings tomorrow before market open, so look to put on this play before today's close. As noted in my post early this week regarding this week's earnings play prospects, PCLN's options are somewhat illiquid, so look for a fill of any setup at or above the mid price and resist the urge to chase price for a fill ... . You can naturally play with the width of the wings and/or or the width of the short option strikes to give you a setup that fits your risk tolerance. Here's the metrics for the basic setup: PCLN Feb 26th 947.5/957.5/1212.5/1222.5 Iron Condor Probability of Profit %: 71% Max Profit: $341/contract (that's the mid price; I regard the likelihood of a fill there quite small) Buying Power Effect: $160/contract (not sure that's correct, but it's what the software's telling me if you shoot for a fill a 3.41) Break Evens: 954/1216
P
by NaughtyPines
TSLA EARNINGS PLAYSTSLA announces earnings tomorrow after market close, so look to put on any volatility contraction play (short strangle/iron condor) before then. You'll naturally want to tweak these strikes if there is any movement during the market day ... . Short Strangle Feb 19th 111/180 short strangle Probability of Profit: 74% Max Profit: $404/contract Buying Power Effect: Undefined Feb 19th 106/111/180/185 iron condor Probability of Profit: 70% Max Profit: $101/contract Buying Power Effect: $400 Notes: I'm probably not going to play this one, since I'm still working off FB and have DIS and BIDU on, as well as a bunch of other index ETF balls I'm juggling ... .
NASDAQ:TSLA
by NaughtyPines
DIS EARNINGS PLAYSDIS announces earnings today after market hours, so look to put on any setup before New York close. Here are the two "classic" setups: Feb 19th 82.5/100 short strangle Probability of Profit %: 74% Max Profit: $127/contract Buying Power Effect: Undefined Feb 19 77.5/82.5/100/105 iron condor Probability of Profit %: 72% Max Profit: $86/contract Buying Power Effect: $414 Notes: You can naturally play with the width of the iron condor wings to increase/decrease buying power effect and/or max profit potential. As always, look to take the setup off at 50% max profit post-earnings or a side at or near max. In the event a side is tested, look to roll the tested side out for duration to a later expiry and then sell an oppositional side against the rolled side for a credit that exceeds the debit paid for any roll and look to exit the rolled out setup for scratch (total debits paid minus total credits paid = 0) and to redeploy your buying power elsewhere. They are, after all, meant to be quick and dirty plays ... .
NYSE:DIS
by NaughtyPines
Short On AUD/USD SELL SELL SELL !!!(Change of heart after break)Reasons for -We have broken our 4 Hour trend line to the downside -Therefore we have broken structure and i 100% believe that after the break we are headed down -We are going to get a impulse wave and this is a strong setup - after all the long term trend is bearish ! Yes weve had two small losses but we are going to make it back on this one ;) Also this is an aggressive entry you may want to wait for the pull back :) On the daily we have put in a bearish engulfing also the previous daily candle was huge bearish candle ! on the daily we can also price making Higher lows ! so we are headed down now i believe My entry 0.70430
Short
by ARFXC
15
Short On USD/CAD SELL SELL SELL !!!Reasons For -We are now down trending on the 4 hour chart -We always want to trade in the direction of the trend -We are making lower lows and lower highs -We are trading below key level at 1.4000 Which we broke with a strong downside move -If we put a Fib in from previous Lower high to the new Lower low price is reacting to the 0.618 Level -Sign of retrace Over ? -We have put in two dojis in on the 4 hour time frame -We have also come to our trend line that is acting as Res and also showing signs of bullish weakness So if we put all those together on the 4 Hour time frame we are extremely bearish If we look at the daily -We are also making new lows and currently in a new forming down trend The trend is your friend -The biggest confluence for me is we have broken the previous higher low on the daily when the uptrend was in affect we have come lower then the previous higher low Which also signifies a change of trend and direction -So after all the bullishness over the past couple years isit over ? well for now we are in full affect to make a new lower low in this current trend which is at 1.3500 Heads up Remember guys this pair is heavily influenced by Oil so it is a more risky pair to trade but in terms of technicals it is a great setup :) Also my entry is very aggressive id recommend waiting for a strong bearish candle on the 4 Hour time frame to confirm more confluence and be a strong selling setup as it confirms our momentum which is bearish So id Recommend waiting but if your a risk taker like me join me lol ;) Only 65 pips Risk well worth the risk with a great Risk Reward of 1:6 :) Trade safe My entry 1.38897
Short
by ARFXC
38
THIS WEEK'S OPTIONS WORTHY EARNINGS PLAYS -- DIS, BIDU, TSLAUnfortunately, I was fiddling around so much with setups in index ETF's and GLD last week that I didn't get a chance to do a single earnings play ... But it's all good. Naturally, if volatility remains high in SPY, DIA, QQQ, and/or IWM, I'll continue to work those. However, while I'm waiting for some kind of bounce to occur to leg into the short call side of those on strength, maybe I'll be able to fit one of these plays in just to keep myself entertained. CVS -- announces on 2/9 (Tuesday) before market open. Implied volatility rank: 83/implied volatility 31. I'll have to look at that one closer to earnings. The implied vol number suggests that while volatility is temporarily high, it's just not one of those underlyings that are very volatile generally speaking. DIS -- announces on 2/9 (Tuesday) after market. Its implied volatility rank isn't quite where I'd like it (63; >70 is better), but you never know what'll happen going into the last couple of days here. BIDU -- announces "some time" on 2/10, which could be before/after market (you'd think they'd know at this point ... ). High implied volatility rank (83) plus high volatility (58) equals good premium. I would probably just look to put on a play on Tuesday if the premium looks attractive (it does right now; even for an iron condor setup). WYNN -- announces "some time" on 2/10. Rank: 95/implied 80. This little guy is not for the faint of heart. I've been in and out of WYNN several times this year as a non-earnings premium selling play and it whips all over the place, with a Daily 14-Period ATR of between 3 and 4 bucks ... . TSLA -- announces on 2/10 after market close. What's not to like about a TSLA play? Implied volatility rank is at 100 and the implied volatility is 82. Beaucoup premium ... . There are naturally a bunch of others announcing earnings, it's just that they're not necessarily good premium selling plays due to their implied volatility, so they'll probably just have to be played some other way ... .
NYSE:DIS
by NaughtyPines
Short On EUR/AUD SELL SELL SELL !!! Reasons For -Firstly after bouncing of 1.6000(Our key level) we have been very bearish as you can see -Also we have been putting in Lower Lows and Lower Highs -We have also cleared our key level at 1.55000 and have been putting in bearish movement -Now we are trading below 1.5500 the only smart thing to do is to sell as we can clearly see strength to the downside -The previous 4 Hour candle was a bearish hammer with a nice long wick showing us more sellers then Buyers -This candle which is just closing now is a big bearish candle which gives us more confidence that we are favouring the downside -On the four hour we are clearly downtrending so we will do the smart thing and go with the trend ... The Trend is your Friend ;) -We are also formed a head and shoulders and now we have broken the neck line this just adds to our confluences :) -We also have lots of long wicks to the upside which is a nice to help with which way price wants to go and whos in control Bears or Bulls and in this case the Bears are in control (Sellers) This pair on the 4 hour time frame is very bearish in my opinion On the daily Timeframe -We have a clear down trend forming Of our key level 1.6000 -the previous day candle stick was a nice big bearish candle -Todays candle is froming a nice long wicked bearish hammer :) And we can see clear waves being implemented -And the weekly we have had 3 non stop weeks of bearishness -Also on the weekly we have nice long wicks to the upside which is a nice little confluence :) All these factors put my bias at bearish My entry is 1.53056 GoodLuck to all trading this pair with me :) P.S I MAY CLOSE EARLY BEFORE THE NEWS AT 3;30 AM GMT !
Short
by ARFXC
25
NEXT WEEK'S EARNINGS PLAYS -- GOOG, CMG, GILD, XOM, LINKDAnd earnings season slogs on ... . Next week there are bunch of biggies, but not all of them are worthwhile options setup plays, primarily due to liquidity. GOOG's option liquidity has never been the greatest, and CMG and LNKD have always been horrid, so right off the bat I would pass on those for options plays. GILD -- announces earnings on 2/2 (Tues) after market close. The options have fairly good liquidity, and its implied volatility rank is currently at 74. XOM -- announces earnings on 2/2 (Tues) before market open. Good liquidity, but the implied vol rank is not where I'd like to see it; it's currently 54, a contraction no doubt due to the bit of strength in oil we've seen the past week ... . Moreover, with the volatility still hanging in there in the broader market (VIX is still marginally over 20), I can afford to be picky and/or not play earnings at all, since my tendency is to slack off earnings plays when the VIX above 15 and go for plays in the broader index ETF's like SPY, IWM, QQQ, and DIA ... . Nevertheless, I'll look at a setup at least in GILD and keep an eye on XOM to see if volatility ramps up to where I'd like to see it (70+ in percentile rank).
NASDAQ:GOOG
by NaughtyPines
Short on USD/JPY SELL SELL SELL !!! (Risky) Reasons for - Clearly price is putting in lower lows and lower highs (Clear Downtrend) - Price broke key level at 120.00 A week back so we maybe heading to next key level ? - Price has put 3 touch on short term 4 Hour trend line - Price put in doji the a bearish engulfing and clearly bearish candle then another bull green candle then another gearish engulfing so clear sign the sellers are in control at the moment pushing price down - We are creating a type of right angle triangle with key structure level (Meaning a strong push of the breakout will occur) - Daily - Previous daily candle was a bearish hammer - On the daily we are clearly down trending so we are following the trend (The trend is your friend) - We are also making lower swings - Price is trading bellow previous key level before cleared on the daily and weekly (A sign that we are looking to go to lower level if enough momentum) So all these confluences clearly show more potential to the downside therefore i will be entering My ENTRIE WAS 117.216
Short
by ARFXC
2
NFLX EARNINGS PLAYNFLX announces earnings on Tuesday 1/19 after market, so look to put on any premium selling play shortly before NY close. Here are two possible setups, which may have to be tweaked, depending on price movement in the underlying: Jan 29 80/128 short strangle Probability of Profit %: 77% Max Profit: $246/contract Buying Power Effect: ~$1041 Break Evens: $77.54/$130.46 Feb 5th 75/80/127/132 iron condor Probability of Profit %: 73% Max Profit: $103/contract Buying Power Effect: ~$397 Break Evens: $78.97/$128.03 Notes: I went out a little longer than I usually like with the iron condor, as I had difficulty on the put side getting the strikes (and credit) I wanted for the setup with the Jan 29 expiry. The Jan 29th short strangle is also a little wider than I usually like to go, as there is some "funkiness" with the strikes on the put side (they open up to five bucks apart at the 1 standard deviation line, unfortunately). Look to take these setups off at 50% max profit and redeploy the buying power elsewhere.
NASDAQ:NFLX
by NaughtyPines