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ES Thursday 3-12-15


Bands for the day. Good luck to all.

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iv031215
only holding one contract now.....u never know if the pivot players are gonna be here ...long way to go for final at 51 but will move final target up to 52.25.....anyone interested should study one minute time profile from Tuesday to see why my areas failed and worked....and retested....except that 51 hasn't yet !!!

value area players will want to see these 30 minute closes stay under the VA high from Tuesday in order to try for more downside......they won't want to fade if we close outside of that VA high
Bruce, just an FYI, there was no way I could have seen that open drive coming (wish I had)! Looks like a short squeeze but just no way to see that coming, unlike the previous 2 instances
Joe if you are here today...reason I don't like the buying of the options is really just like you said the other day.....you can be right on direction but time eats away your profits due to premium decay.....

now as a seller of out of the money options ( like the puts I sold the other day )....I can make money if we go up, make money if we stay even or make money if we drop down some......when I lose money is if we have a big and QUICK sell off.....

The key I think is to not get greedy........the puts I sold were sold at 95 bucks a piece and YD I bought back at 55 bucks,,,,and last two I bought back today at 15 bucks...but the real important thing is these far out of the money options can make money 90% of the time but you can still lose money on the 10% of the time u r wrong...so managing and not letting those losers go all the way is where you need to exit and NEVER let it go to a big loss on that 10 % of the time....

In most of the reading on forums it seems that most lose selling options because they try and capture all the premium sold...... It seems better to be happy at the 33 - 50% mark and maybe hold if u think you have the direction pegged....

The other reason I fail at buying options is because I end up not managing them.....I would buy them in the past ( long ago) and just hope it would go my way and many times lose all the option value....instead of actively managing them
Bruce, you sound exactly like that video i saw on dough.com YD. Makes sense though. Completely makes sense on your approach
is it going to be "P" formation day today?
so far it's a positive for bears that they can't close outside of that VA high or get outside of Ib high
I have a dough account and TOS...missed that video...lots of good ideas around...that carter stuff was really good too....tastytrade has great stuff too.....bottom line is that it can pay to be a seller of options if you can take a loss and manage that risk.....the longer term nature of option selling is good for my short term trading "personality"
Originally posted by NewKid

Bruce, you sound exactly like that video i saw on dough.com YD. Makes sense though. Completely makes sense on your approach
the only downside to selling options (IMO) is that your profit is limited (100% of the premium) but your loss is unlimited. So like you said, you have to manage them actively. In the past I made some money buying options on AAPL but I did not manage it, so lost money too.
will try shorts around 61.5 if we get up there
well u can limit losses with credit spreads.......so if you sell a put at 100 strike for example then you buy a 95 put just in case the thing really sells off.....so your risk is defined to 5 bucks minus the amount you received for selling the 100 strike put.....so the risk to reward is out of whack but you still can account for the rare big moves.....no selling naked...too dangerous for the account
Originally posted by NewKid

the only downside to selling options (IMO) is that your profit is limited (100% of the premium) but your loss is unlimited. So like you said, you have to manage them actively. In the past I made some money buying options on AAPL but I did not manage it, so lost money too.
daily party ended at 58 today for me...I have no place for a stop and one point away from last target which is HTN for today...( actually 56.75 is exact high time price)...good luck if ya hang out