Based on observation from previous years that a lot of folks close out positions at the end of the year for tax purposes. Since we are trending up currently, may not be the case, but overall hasn't been that great of a year.

I would be interested in your thoughts as well.

Trading question on SPY Dec30 126 put.

OK - so got to the end of the day and was faced with the choice of selling or holding through til tomorrow. Chose to take a small loss to avoid Theta decay.

I was assuming that there will be a significant end of year selloff this week.

Would it have made sense to stay in overnite, assuming there could be a big selloff tomorrow?

What would be your decision criteria?

TIA.

Sold SPY Dec30 126 Put @.65 -.02

BOT SPY Dec30 126 Put @.67

Thanks D-K. That is an amazing find. If we had stickies, it would go there.

Wow Newly - that was exactly the info I was looking for! Thanks so much.

I've had quite a bit of training and self-study on TA, candlesticks, etc. so I'm not a total novice. But it was oriented towards longer term trades. Still learning from you guys how to apply it to daytrading.

Thanks everyone for posting your trades so people can learn along with you!

Hi Newly - thanks for the response. In retrospect, my questions were too demanding - please accept my apologies.

I will continue to follow the trades on the board closely, while watching the charts to learn from you guys. Any explanatory notes you can include when you post will be greatly appreciated. I will be trading a very small learning account as I watch you guys and a couple of other boards.


Thanks and have a wonderful and prosperous New Year!
Jane

Lee - from my still-emerging understanding of technical analysis, the indicators are not necessarily predictive, but show trade patterns with a high probability of repeating. (More experienced folks on this board - correct me if I am wrong).

Sort of like finding a good fishing spot. The indicators tell you that there is a high probability of fish biting, but no guarantees that you will catch anything. You have to have good fishing skills on top of a good fishing spot, and just a little bit of luck as well.

That's why I follow the really good traders on this board, trying to figure out how they can tell where the best fishing holes are, and how they fish particular situations.

Have a Merry Xmas - let's learn together.
-Jane

On the subject of Christmas discussions, I would really enjoy hearing from experienced traders how you plan your trades for the day. For example:

1. What do you look at in the morning to decide what options you will trade - do you scan a fairly regular set of options, or a broad range?

2. What are your decision criteria for entering a trade?
What signals do you look for to enter a trade?

3. Some of you are really good at spotting a good run, versus a short blip. How do you recognize the run coming up versus a blip?

4. What are your thoughts about time of day to enter a trade - do you avoid the first 30 minutes or so?

5. For daytrading, do you use charts with support and resistance mapped out, fibs, etc? For what period?

I know this is a lot to ask - perhaps you could tackle it in pieces as you recover from Christmas/Hanukkah dinner....

Thanks everyone and happy holidays!

Also - prayers and thoughts to Roy and Doris! Hope you are doing OK.

Aren't bollies, OBV, and other indicators used to track changes in price, volume and or movement?

Good going Beer!

AAPL is running hard today - surprising considering OPEX. Waiting for them to lower the boom any time.

I just switched to that view - very helpful- thanks Beer and Dot. Also, had never used OBV before - watching closely today.

As a general rule, what chart time frame are you using?

Awesome call so far - I am just amazed at how good you guys are!

Hi Beer - I'm just watching today. Looks to be a quiet day.

If you have time, could you please explain what signals you were looking at in your decision to go long on SPY this morning?

I am paper trading today just to observe what happens on a low volume OPEX day. Trying to practice reading candlestix.

TIA - Jane

Thanks to everyone for your explanations on options and divs. It's so nice to be able to ask experienced folks.

Does the company drop the stock price, or is the drop the result of market activity? I am going to track this for awhile to see how it works in real time.

Thanks for sharing.

Q: Trading options around ex-div dates.

I have been studying a one year chart of AGNC to see if it might be profitable to try to trade options on big dips that occur right around exdiv dates.

AGNC pays a very large dividend. The share price goes up dramatically leading to the ex-div date, then it nosedives, which doesn't make sense to me. I would think people would sell after exdiv, not just before. Am I reading this chart wrong?

The volatility on AGNC is regular enough that it might be an interesting potential trade.

Does anyone here trade options around divs?

Thanks for your thoughts.

I've been following AAPL options on OPEX days for quite awhile and this seems very true. There are a lot of traders who have learned the pattern and use it to trade on those days profitably - I am not yet one of them, but watching to learn how they do it.

Watching you make bank! WOW - great job!

I like your philosophy. Experience is always the best, but most expensive teacher. Will refill my practice trading account next week and be back.

In the meantime, I'm enjoying watching what happens on triple witching day. Wish I had cash this morning!

Very helpful - LOL

Sorry for your bad day. I was paper trading today just for practice to see if I could spot the turns. Glad it wasn't real money - I would have lost on most of my paper trades today.

Seems very unpredictable right now. Tomorrow will be my first time to observe a triple witching day. Will just paper trade - don't know what I'm doing yet.

Good luck to you!

Question for the board: What happens to options trading on triple witching day? I will be observing tomorrow, but not sure of the significance or what to watch for.

Thanks to everyone.

PS - Roy, if you are following the board, hope that you and Doris are doing OK. We miss you.

Hi Smartone,

I was following along some of the trades on this board today and was baffled in the last 20 or minutes or so when SPY and AAPL both had little run-ups, but the call price barely budged. At one time, both the call and put prices (close to the money) were both dropping.

Was this because of decay at the end of day? Glad I wasn't trading today - I would have lost a lot.


TIA.

Good advice - thanks.

Ouch! Wiped out today on AAPL 390puts. I was betting that the MMs would drop AAPL to the maxpain pin of $390, but didn't happen.

My learning account is usually between $100-200, so not a disaster, just a mildly expensive learning experience.

Starting from ground zero again. Oh well.....

Roy, I would send some prayers, but sounds like they've already been answered. Will miss you on the board today. Get better soon Doris!

Congratulations Beer. Must be all the good beer.

Seriously - I have learned a lot from following you and the other good traders on this site. Glad that you are going to be around for a lot longer!

Out IWM Dec 9 74 Calls at 1.24. Charts starting to look ugly.

+ .17. Insignificant gain, but didn't lose anything today!

You rocked this one Roy!

I'm out of trades til Friday. Time to play now.

Someone on another board said that with Friday OPEX, that the hedge funds will try to keep the price in a narrow channel in order to burn premium for in-the-money options.

I also wonder if there isn't some high-frequency trading going on. I keep seeing orders of 13,000-15,000 flashing on bid, then disappearing. Very little change in actual volume.

What do you think?

Yeah - seeing that too on on the 74s. I'm green already, so it's mostly a learning experience for me. I had never heard of IWM - thanks for turning me on to it!

Cool - just found it on Etrade - never used that before.

Ya learn sumpin' every day!

Thanks

Good profit Roy.

I hadn't thought of looking at the # of bids. Where do you see that?

Bot Dec9 IWM 74 Calls @ $1.09.

May have come in a bit late, but still seems promising for today.
- Reverse Head and shoulders
- Gap to fill

Thanks Farooq - that was helpful.

Not bad yourself Roy! It's a beautiful day in the neighborhood...

Sold SPY Dec9 $125 Puts at 1.30.

+ .31 - not bad for the day!

I am watching (in no particular order)

- the clock (assuming a lot of folks won't want to hold over nite given this uncertainty)

- MACD

- STOCHs

_ volume

- AAPL - because SPY tends to follow AAPL very closely

- Postings by some guys on the AAPL Yahoo message board who tend to be very very good traders (AEA guys and FunnieBucket). When they start closing their shorts, it's a pretty strong indicator. They are not necessarily commenting on just AAPL.