trading weekly options for a living...

WklyOptions

Well-known member
269 24
Hi, T2W traders,

Well, sharp down days - 2 in a row - in the US equities. Made Adjustment to the FAS ongoing campaign:

Sold to Open (-10) FAS Aug2(8th) $94 Weekly Call

Bought to Close (+10) FAS Aug2(8th) $100 Weekly Call

Net Credit (+$1.99)

Prev Adjusted Cost Basis = (+$0.44)

New Adjusted Cost Basis = (+$2.43) Note > 0 (y)

Current position(s):

Short (-10) FAS Aug2(8th) $94 Weekly Call Option

Long (+10) FAS Sep(20th) $107 Call Option

Risk = Bearish Call Diagonal Spread exposed if FAS > $96. :!: :cool: :eek:

Plan
(1) Continue to HOLD and extract extrinsic time value.
(2) Consider Adjustment of short Aug2(8th) $94 Weekly Call Option - if FAS > $96 before 08/08/2014.
(3) Consider Adjustment of Sep $107 Call - if see poss Key Support developing on Hourly and Daily time-frames.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
New Campaign on TNA

T2W traders,

Opened this new trading campaign on the ETF of TNA (3x Small Cap Bullish):

Sold to Open (-6) TNA Aug2(8th) $66 Weekly Call @ (+$2.11)

Bought to Open (-6) TNA Sep(20th) $66 Call @ (-$5.40)

Net Debit (-$3.29) per calendar spread.

Initial Cost Basis = (-$3.29) per spread. :!: (y)

Initial Max Risk = (-$329) x6 = (-$1974)

Plan: :cool:

(1) Hold & extract extrinsic time value of short call options.
(2) Adjust if TNA > $68 - plan to roll up & out the short call options.
(3) Adjust if short call Ask < ($0.25).
(4) Trade duration = minimum thru 09/19/2014.
(5) Currently market-neutral but will roll into bearish spread if TNA conts down.
(6) Currently market-neutral but will roll into bullish spread if TNA > $68.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Hi, T2W traders,

Well, sharp down days - 2 in a row - in the US equities. Made Adjustment to the FAS ongoing campaign:

Sold to Open (-10) FAS Aug2(8th) $94 Weekly Call

Bought to Close (+10) FAS Aug2(8th) $100 Weekly Call

Net Credit (+$1.99)

Prev Adjusted Cost Basis = (+$0.44)

New Adjusted Cost Basis = (+$2.43) Note > 0 (y)

Current position(s):

Short (-10) FAS Aug2(8th) $94 Weekly Call Option

Long (+10) FAS Sep(20th) $107 Call Option

Risk = Bearish Call Diagonal Spread exposed if FAS > $96. :!: :cool: :eek:

Plan
(1) Continue to HOLD and extract extrinsic time value.
(2) Consider Adjustment of short Aug2(8th) $94 Weekly Call Option - if FAS > $96 before 08/08/2014.
(3) Consider Adjustment of Sep $107 Call - if see poss Key Support developing on Hourly and Daily time-frames.

Regards,

WklyOptions

Hi, T2W traders,

Today the FAS declined < $93 in the morning session - elected to EXIT the FAS campaign as a possible temporary short-term Key Support was developing with a Bullish Divergence on the 15-min chart. (y)

Here is the final closing spread FAS data and Net results:

Bought to Close (+10) FAS Aug2(8th) Weekly $94 Call @ (-$1.05)

Sold to Close (-10) FAS Sep(20th) $107 Call @ (+$0.60)

Net Debit = (-$0.45) :whistling

Initial Cost Basis = (-$2.21) per spread or (-$2210) Risk.

Adjusted Cost Basis = (+$1.98) or (+$1980) Net Profit. :clap:

Return = (+89.6%) over two weeks from 7/23/2014 thru 8/5/2014.

Now will just focus on managing the open TNA campaign. :smart:

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
T2W traders,

Opened this new trading campaign on the ETF of TNA (3x Small Cap Bullish):

Sold to Open (-6) TNA Aug2(8th) $66 Weekly Call @ (+$2.11)

Bought to Open (-6) TNA Sep(20th) $66 Call @ (-$5.40)

Net Debit (-$3.29) per calendar spread.

Initial Cost Basis = (-$3.29) per spread. :!: (y)

Initial Max Risk = (-$329) x6 = (-$1974)

Plan: :smart:

(1) Hold & extract extrinsic time value of short call options.
(2) Adjust if TNA > $68 - plan to roll up & out the short call options.
(3) Adjust if short call Ask < ($0.25).
(4) Trade duration = minimum thru 09/19/2014.
(5) Currently market-neutral but will roll into bearish spread if TNA conts down.
(6) Currently market-neutral but will roll into bullish spread if TNA > $68.

Regards,

WklyOptions

Hello, T2W traders,

Update on TNA campaign this morning (1108am ET):

TNA = $67.85

The short weekly $66 call is expiring today - and it has effectively no extrinsic time value. Received Trade Alert to roll it out and up - to generate new extrinsic time value to harvest for the following week: :smart:

Bought To Close (+6) TNA Aug2(8th) $66 Weekly Call @ (-$1.85)

Sold To Open (-6) TNA Aug(15th) $68 Weekly Call @ (+$2.07)

Net Credit (+$0.22) (y)

Current Positions:

Short (-6) TNA Aug(15th) $68 Call @ (+$2.07)
($2.05-$2.09)

Long (+6) TNA Sep(20th) $66 Call @ (-$5.40)
($6.15-$6.30)

Initial Cost Basis = (-$3.29) per spread

Initial Max Risk = ($329) x 6-lot = (-$1974)

Current Cost Basis = (-$3.07) per spread

Current Max Risk = (-$307) x 6-lot = (-$1842)

Current TNA price action indicates possible bullish bias on the Hourly and Daily chart. The current call diagonal spread has a bullish bias - so it will be maintained for now. :cool:

Plan: :smart:
(1) Hold positions.
(2) Look to EXIT - Buy To Close (+6) Aug(15th) $68 Call if Ask < ($0.25).
(3) Look to Adjust - if TNA > $70.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Hi, T2W traders,

Just opened a new FAS trading campaign:

Sold to Open (-4) FAS Aug(16th) $94 Call @ (+$2.21)

Bought to Open (+4) FAS Oct(18th) $94 Call @ (-$6.83)

Net Debit (-$4.62) per spread (y)

Initial Cost Basis = (-$4.62) per spread

Initial Max Risk = (-$462) x 4-Lot = (-$1848) :cool:

Plan: :smart:

(1) HOLD positions thru next week (unless Adjustment required).
(2) Buy To Close (+4) FAS Aug(16th) $94 Call if Ask < ($0.25).
(3) Look to roll out & up the short FAS Aug(16th) $94 Call - if extrinsic time value < ($0.25) when FAS hits $96 or higher.
(4) Campaign Duration = estimate between 1 week to 5 weeks maximum duration.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Learning Points on my new FAS campaign.

Hi, T2W traders,

Just opened a new FAS trading campaign:

Sold to Open (-4) FAS Aug(16th) $94 Call @ (+$2.21)

Bought to Open (+4) FAS Oct(18th) $94 Call @ (-$6.83)

Net Debit (-$4.62) per spread (y)

Initial Cost Basis = (-$4.62) per spread

Initial Max Risk = (-$462) x 4-Lot = (-$1848) :cool:

Plan: :smart:

(1) HOLD positions thru next week (unless Adjustment required).
(2) Buy To Close (+4) FAS Aug(16th) $94 Call if Ask < ($0.25).
(3) Look to roll out & up the short FAS Aug(16th) $94 Call - if extrinsic time value < ($0.25) when FAS hits $96 or higher.
(4) Campaign Duration = estimate between 1 week to 5 weeks maximum duration.

Regards,

WklyOptions

Hi, T2W traders,

I wanted to post a Lesson here on the above new FAS trade I just made. It is similar to the TNA trading campaign that is currently open. However the TNA campaign has a more volatile asset - and higher "difficulty" profile - as it only goes to the Sep(16th) expiry deadline. Less time = more focus required to monitor quick profit-locking opportunities/adjustments.

Okay - first let's buy a highly leveraged and volatile asset - FAS is a favorite of mine. Then let's insure that the entire campaign is exited no later than the Oct 18th expiry period.

(1) I purchased a new asset, FAS, 400 shares worth (when it was $94.34). This had a cash value of $37,736.00 (USD).
(2) Then I purchased an INSURANCE policy to guarantee that I will exit the FAS shares at $94 with insurance coverage thru the Oct 18th expiry deadline:
(a) Owning 100 shares + 1 at-the-money put = insured "married put" profile. :cool:
(b) Long 100 shares + 1 at-the-money put = 1 at-the-money call (synthetic equals). :whistling
(c) Using Calls as synthetic married put benefits: (i) leverage, (ii) exit Oct 18th max duration. (y)
(3) The insurance policy thru Oct 18th expiry cost me net (-$683) per 100 shares or a total of (-$2732). This is the MAX LOSS for the 400 shares of FAS thru Oct 18th expiry.

Notice the LEVERAGE that was gained thru the Oct 18th expiry campaign deadline. I paid (-$2732) to control $37,736.00 of an asset. This is a leverage factor of (+13.8x)! :whistling

Next - I will be selling front week's call options against my insured asset. I'll try to keep track of the actual weekly income generated by this trading plan:

(4) At the start today, and thru next week's expiry, I sold (-4) FAS Aug(16th) Calls for (+$2.21) = (+$884) cash income into my trading account! (y)
(5) IF - and a big one at that - can continue to generate weekly income of (+$800) or more per week, then should be able to get back the initial (-$2732) over the next 3-4 income-generating weeks.
(6) Reasonable Target Profit objectives for this type of campaign: anywhere from (+40%) or better - in 5 weeks or less. Obviously if doing better, can hold campaign to pursue even better profitability. :cool:

Then it is a matter of continuing to harvest weekly income by selling front week calls to capture its extrinsic time value! :smart:

Well, let's see what happens in the next 1-5 weeks (anticipated exit < 5 wks).

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Campaign Update - TNA diagonal call spread campaign

Hello, T2W traders,

Update on TNA campaign this morning (1108am ET):

TNA = $67.85

The short weekly $66 call is expiring today - and it has effectively no extrinsic time value. Received Trade Alert to roll it out and up - to generate new extrinsic time value to harvest for the following week: :smart:

Bought To Close (+6) TNA Aug2(8th) $66 Weekly Call @ (-$1.85)

Sold To Open (-6) TNA Aug(15th) $68 Weekly Call @ (+$2.07)

Net Credit (+$0.22) (y)

Current Positions:

Short (-6) TNA Aug(15th) $68 Call @ (+$2.07)
($2.05-$2.09)

Long (+6) TNA Sep(20th) $66 Call @ (-$5.40)
($6.15-$6.30)

Initial Cost Basis = (-$3.29) per spread

Initial Max Risk = ($329) x 6-lot = (-$1974)

Current Cost Basis = (-$3.07) per spread

Current Max Risk = (-$307) x 6-lot = (-$1842)

Current TNA price action indicates possible bullish bias on the Hourly and Daily chart. The current call diagonal spread has a bullish bias - so it will be maintained for now. :cool:

Plan: :smart:
(1) Hold positions.
(2) Look to EXIT - Buy To Close (+6) Aug(15th) $68 Call if Ask < ($0.25).
(3) Look to Adjust - if TNA > $70.

Regards,

WklyOptions

T2W traders,

Just a brief update on the TNA diagonal call spread campaign. :|

TNA closed today at $70.75. The short TNA Aug(15th) $68 Call is priced at $2.63-$3.20. Currently there is NO EXTRINSIC TIME VALUE left on this Aug(15th) $68 Call option.

I anticipate an Adjustment Alert to be triggered tomorrow to roll out and up this short leg. The campaign must continue to have short front week options to extract extrinsic time value. (y)

Current Positions:

Short (-6) TNA Aug(15th) $68 Call @ (+$2.07)
($2.63-$3.20)

Long (+6) TNA Sep(20th) $66 Call @ (-$5.40)
($6.95-$7.65)

Initial Cost Basis = (-$3.29) per spread

Initial Max Risk = ($329) x 6-lot = (-$1974)

Current Cost Basis = (-$3.07) per spread

Current Max Risk = (-$307) x 6-lot = (-$1842)

Current Liquidation Value (Mid-Price) = (+$4.38) at mid-price (y)

From a technical chart perspective, there is some conflict between the Weekly (bearish momentum bias) vs the Daily/Hourly charts (mild bullish momentum bias). This conflict usually suggests ongoing trading range price action. There is Key Support at $67 and Key Resistance in the $72/$73 price zone.

I will update more if/when such an Adjustment is executed tomorrow.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
FAS campaign update - call calendar spread

Hi, T2W traders,

Just opened a new FAS trading campaign:

Sold to Open (-4) FAS Aug(16th) $94 Call @ (+$2.21)

Bought to Open (+4) FAS Oct(18th) $94 Call @ (-$6.83)

Net Debit (-$4.62) per spread (y)

Initial Cost Basis = (-$4.62) per spread

Initial Max Risk = (-$462) x 4-Lot = (-$1848) :cool:

Plan: :smart:

(1) HOLD positions thru next week (unless Adjustment required).
(2) Buy To Close (+4) FAS Aug(16th) $94 Call if Ask < ($0.25).
(3) Look to roll out & up the short FAS Aug(16th) $94 Call - if extrinsic time value < ($0.25) when FAS hits $96 or higher.
(4) Campaign Duration = estimate between 1 week to 5 weeks maximum duration.

Regards,

WklyOptions

T2W traders,

FAS closed today at $97.67.

Current FAS positions:

Short (-4) FAS Aug(16th) $94 Call @ (+$2.21)

Long (+4) FAS Oct(18th) $94 Call @ (-$6.83)

Net Debit (-$4.62) per spread

Initial Cost Basis = (-$4.62) per spread

Initial Max Risk = (-$462) x 4-Lot = (-$1848)

The Short (-4) FAS Aug(16th) $94 Call is currently at ($3.45-$3.90). There is NO EXTRINSIC TIME VALUE in this short call leg.

The campaign will require to roll out and up from the short Aug call option to generate and lock in additional extrinsic time value. :idea: (y)

Plan:
(1) Look to roll out & up on the short Aug(16th) $94 Call leg asap. Await expected Adjustment Alert to be triggered sometime during tomorrow's NYSE trading session.

I will update more tomorrow if/when the Adjustment Alert is executed.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Closing out TNA spread campaign

Hi, T2W traders,

Elected to CLOSE OUT the TNA spread trade campaign for now - as the FAS campaign is requiring more attention (breakout out to the upside).

Exited TNA spread this morning at Net Credit (+$3.95).

Will go thru TNA Debrief of Result & Lessons later today after NYSE trading hours.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
FAS campaign - trade update - Adj on Short Call

T2W traders,

FAS making a move to the upside over past two trading days - now requiring some Adjustments:

(1) Rolled up & out the Short Aug(16th) $94 Calls to Short Aug4(22nd) $98 Calls for Net Debit (-$2.60).

Now will monitor FAS 15-min and Hourly charts for area to roll up the Oct(18th) $94 Calls to the $98 strike price level.

It is best to do this if/when FAS begins to consolidate and show lower time-frame weakness.

I will update the FAS campaign later today after the NYSE trading session.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
FAS call diagonal spread campaign - update on Adjustment

T2W traders,

FAS making a move to the upside over past two trading days - now requiring some Adjustments:

(1) Rolled up & out the Short Aug(16th) $94 Calls to Short Aug4(22nd) $98 Calls for Net Debit (-$2.60).

Now will monitor FAS 15-min and Hourly charts for area to roll up the Oct(18th) $94 Calls to the $98 strike price level.

It is best to do this if/when FAS begins to consolidate and show lower time-frame weakness.

I will update the FAS campaign later today after the NYSE trading session.

Regards,

WklyOptions

Hi, T2W traders,

Performed Adjustment on FAS diagonal call spread campaign:

Bought to Close (+4) FAS Aug(16th) $94 Call @ (-$4.48)

Sold to Open (-4) FAS Aug4(22nd) Weekly $98 Call @ (+$2.03)

Net Debit (-$2.45)

Current Positions:

Short (-4) FAS Aug4(22nd) Weekly $98 Call @ (+$2.03)

Long (+4) FAS Oct(18th) $94 Call @ (-$6.83)

Initial Cost Basis = (-$4.62)

Current Cost Basis = (-$7.07) :whistling

FAS remains in a wide trading range from $92 to the $100 price zone. However the bias remains mildly bullish.

The Long Oct $94 Call options will not be rolled up at this time. For now - a mild bullish bias (long net delta position) will be maintained. (y)

Plan:
(1) HOLD positions.
(2) Look to manage the short Aug4(22nd) $98 Call leg if FAS > $100 or if the call option has Ask < $0.20.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
Debrief TNA call diagonal spread = (+20.6%) in 14 days

Hi, T2W traders,

Elected to CLOSE OUT the TNA spread trade campaign for now - as the FAS campaign is requiring more attention (breakout out to the upside).

Exited TNA spread this morning at Net Credit (+$3.95).

Will go thru TNA Debrief of Result & Lessons later today after NYSE trading hours.

Regards,

WklyOptions

Hi, T2W traders,

TNA has remained in a trading range between $66 and $72. This has helped the TNA call diagonal spread campaign some.

The campaign was closed early b/c the FAS trade needed a closer bit of monitoring and management for me. FAS has a stronger bullish trend bias but can reverse quickly given the skittish sentiment in the general marketplace.

TNA Summary:

Initial Cost Basis = (-$3.29) on 08/01/2014.

Final Cost Basis = (+$3.95) on 08/14/2014.

Net Gain = (+$0.66) per spread x 6-Lot = (+$396).

Return = (+20.1%) in 14 days.

Lessons Learned:

(1) The campaign was exited early b/c of the required greater attention and time to monitor and manage the FAS campaign. Lesson = ALWAYS focus and be aware of "if and when" - other positions or life's circumstances - require additional time, $$$, and attention/focus management! (n)

When this occurs - ALWAYS reduce the # of open positions asap! A "distracted" trader mindset = "trading signal" to reduce open positions to only 1-2 maximum to allow for "task saturated" optimal performance capacity. (y)

(2) Another reason to exit the TNA campaign = the Long Sep Call option was going to be seriously exposed to theta time-decay coming into < 30 days to expiry.

(3) Time to focus on FAS for now! Clear the mind off the TNA campaign! :clap:

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
TNA closed campaign: (+20.1%) - NOT (+20.6%)

Hi, T2W traders,

TNA has remained in a trading range between $66 and $72. This has helped the TNA call diagonal spread campaign some.

The campaign was closed early b/c the FAS trade needed a closer bit of monitoring and management for me. FAS has a stronger bullish trend bias but can reverse quickly given the skittish sentiment in the general marketplace.

TNA Summary:

Initial Cost Basis = (-$3.29) on 08/01/2014.

Final Cost Basis = (+$3.95) on 08/14/2014.

Net Gain = (+$0.66) per spread x 6-Lot = (+$396).

Return = (+20.1%) in 14 days.

Lessons Learned:

(1) The campaign was exited early b/c of the required greater attention and time to monitor and manage the FAS campaign. Lesson = ALWAYS focus and be aware of "if and when" - other positions or life's circumstances - require additional time, $$$, and attention/focus management! (n)

When this occurs - ALWAYS reduce the # of open positions asap! A "distracted" trader mindset = "trading signal" to reduce open positions to only 1-2 maximum to allow for "task saturated" optimal performance capacity. (y)

(2) Another reason to exit the TNA campaign = the Long Sep Call option was going to be seriously exposed to theta time-decay coming into < 30 days to expiry.

(3) Time to focus on FAS for now! Clear the mind off the TNA campaign! :clap:

Regards,

WklyOptions

T2W traders,

Quick update and apology on Subject Line for previous post on TNA Debrief.

Subject Line had (+20.6%) - but it was (+20.1%) over 14 days.

This error also another "symptom" of my task-saturated trading mental capacity. (n)

So all the more reason to only focus on FAS for now.

Regards,

WklyOptions
 

WklyOptions

Well-known member
269 24
FAS @ $102.39 - Weekly Options Campaign - New Adjustment Today

Hi, T2W traders,

Performed Adjustment on FAS diagonal call spread campaign:

Bought to Close (+4) FAS Aug4(22nd) Weekly $98 Call @ (-$4.50)

Sold to Open (-4) FAS Aug5(29th) Weekly $102.50 Call @ (+$1.81)

Net Debit (-$2.69)

Current Positions:

Short (-4) FAS Aug5(29th) Weekly $102.50 Call @ (+$1.81)
($1.73-$1.98)

Long (+4) FAS Oct(18th) $94 Call @ (-$6.83)
($9.30-$10.75) (y)

Initial Cost Basis = (-$4.62)

Current Cost Basis = (-$9.76) :whistling

Chart & Position Analysis:

(1) FAS remains fixed in a bullish trend and momentum bias in D, W, and M time frames. This is confirmed by general bullish bias in the overall markets.

(2) The Short Front Weekly Aug4(22nd) $98 Calls were rolled out and up early. There was effectively zero extrinsic time value left to extract. (n)

(3) The new Short Front Weekly Aug5(29th) $102.50 Call options generated new (+$1.81) in extrinsic time value. (y)

Plan:

(4) HOLD positions for now.

(5) Adjust Short Call leg IF - FAS > $104. Consider another roll out & up adjustment.

(6) Buy to Close Short Call leg IF - ASK < ($0.15).

(7) Consider roll out & up of the Long Oct $94 Call options IF - see FAS basing and weakening along the lower time-frames.

I will continue to monitor and update as necessary. Thx!

WklyOptions
 

WklyOptions

Well-known member
269 24
FAS @ $106.36 - Weekly Options Campaign - New Adjustment Today

Hi, T2W traders,

FAS continues to remain bullish - today hovering at $106.36 zone. Time to adjust and roll out and up the short weekly call option:

Adjustment today:

Bought to Close (+4) FAS Aug5(29th) $102.5 Weekly Call @ (-$4.65)

Sold to Open (-4) FAS Sep1(5th) $106 Weekly [email protected] (+$2.21)

Net Credit (-$2.44) (n)

Current Positions:

Short (-4) FAS Sep1(5th) $106 Weekly Call @ (+$2.21)
($2.11-$2.40)

Long (+4) FAS Oct(18th) $94 Call @ (-$6.83)
($12.65-$14.95) (y)

Initial Cost Basis: (-$4.62)

Previous Cost Basis: (-$9.76)

Current Cost Basis: (-$12.20) :whistling

Chart & Position Analysis:

(1) FAS and the general market remains in a bullish trend & momentum bias.
(2) Today's adjustment was done because the extrinsic time value has effectively deteriorated on the Aug5(29th) short $102.50 weekly call option. :idea: (n)

Plan:
(3) HOLD positions for now.
(4) Look to adjust if FAS > $108.
(5) Look to Buy to Close the Short (-4) FAS Sep1(5th) $106 weekly call if Ask < ($0.20).
(6) Look to roll up the Long (+4) FAS Oct(20th) $94 Call if - FAS starts to indicate bearish weakness in the lower time-frames. :smart:

Thank you.

WklyOptions
 
 
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