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Cash in: No hold weekend for meNo reason to hold anything over the weekend unless you have to. Something smelly about the markets. I can feel the SPY wanting to sell. MPC rallied up testing 37.00 fib level. It tested that level and it did not breach. The chart indicates overall bullish. It has/is building a nice $35 floor for itself. THE MODEL HAS NOT BEEN RE-DRAWN AND MPC IS TRADING PER THOSE FIB LEVELS SINCE MY FIRST MPC FIB POST. You can put a strangle on at 37.00 and 35.00 if you can afford to be that close to the money, but my money is better off elsewhere. Now, if it rallies to $37.80, that'd make a nice cup formation. MPC has history of cup-and-handle breakout (see older chart). Now, if you have followed my posts, you will have noticed me repeatedly saying that MPC has a history of bucking the SPY. It has. With that said, it's outside my own personal risk appetite. Have a good weekend!
NYSE:MPC
by nodiggity
1
EARNINGS PLAYS I WILL BITE ON -- NFLX, GOOG & GS I have a love-hate relationship with earnings plays. When they work out, I'm happier than a clam; when they don't, I swear off them, use expletives to describe them, and say that they're a total *?! waste of time. That being said, there are some I just can't pass up, usually because the premium is just too good. In the next couple of weeks, these will be NFLX, GOOG, and GS, so I am keeping a little bit of powder dry to do those. Tips: 1. Look to put on a short strangle or iron condor prior to the close of the New York session before which the earnings announcement will occur. As a general rule, I play these nondirectionally, assuming no directional bias for the underlying and generally set up the sides at or around the 1 standard deviation line for both the call and put side. 2. Use expiries that are either the weekly options expiry immediately after the announcement or, if that provides too short a time frame in which to potentially manage the trade post-announcement, the Friday expiration thereafter. I generally prefer the weekly expiries for these setups, since they sometimes give you strikes in .50 increments, which allow you a little more precision with your strikes. 3. For both the short strangle and iron condor setups, I look to take the entire setup off at 50% max profit as volatility contracts post-announcement. 4. In the event of a test of a side of the setup, look to roll that tested side out to a later expiry for at least a credit equal to the cost of putting the trade on (fees/commissions) two to three days prior to expiry and close out the untested side or allow it to expire worthless. Additionally, attempt to improve the strike prices for the rolled out side if possible. Lastly, after rolling out the tested side, match it with an oppositional trade in the same expiration as the rolled out side (for example, if the put side is tested, roll it out to a later duration and set up a call side for that same expiry, ordinarily at or around the 1 standard deviation line for that expiry). My general rule is to roll out to the expiry that is of the shortest days until expiration that provides me with an opportunity to both roll for no additional cost in fees and commissions and that allows me to improve my strike price. If a particular expiry doesn't afford you that opportunity, try a later expiry for the roll. I'll post examples of setups in these and any other "too good to pass up" high volatility, premium selling earnings plays as we get closer to the announcements .... .
NASDAQ:AMZN
by NaughtyPines
Tesla Motors - TSLA - Daily - Strangle Option TradeIn preparation for the upcoming earnings report, Tesla has some clear probabilities in front of it, from my perspective. If they report a great number and forecast, it will be $250 in a heart-beat. If they stumble at all in any way, it will be $150 in a heart-beat. So I view owning both puts and calls here as the best strategy. Buy the $210 calls and Buy the $185 puts for less than $15 (Feb 20 185 puts are $5, Feb 20 210 calls are $7 for a total of $12 currently) and exit the position at $40, $45 and $50. Risk a drop of $7. So you stand to either make $30+ or lose $7 per option (Options represent 100 shares of stock, so the smallest risk here is $700 for one strangle). Risk a maximum of 1% of your trading capital if the stop loss is hit. IF TSLA gaps down anywhere near $150, then I would highly recommend going LONG with a $120 stop and a $200 target. Risk $30 to make $50. Exit puts IMMEDIATELY at the first touch of $150 and buy stock to get long. The options will likely be too expensive to buy, so if anything, I'd consider selling the $150 puts to get long TSLA at $150. Why am I publishing this now since earnings are so far off? Because I feel strongly about this trade now and think this is a reasonable risk/reward and if oil rallies back up, then TSLA will lift now. If oil melts down further, then TSLA will sink. If Oil holds steady AND TSLA has a great forecast for Model-X, then TSLA will skyrocket. I think it is safe to bet AGAINST TSLA staying at this price over the longer term when a YEAR AGO I thought TSLA was a good bet to go sideways. (See previous forecasts). OH - And we need a new button here at Tradingview to click on BOTH "LONG" and "SHORT".... I'll choose LONG just because I'm cheering for TSLA, but I don't want to have my comment be considered NEUTRAL! Cheers. Tim 12:50PM EST Friday, January 23, 2015
NASDAQ:TSLALong
by timwest
9