Wednesday, February 10, 2010

02/10 NDX Fast Butterfly

I am monitoring here what this position would look like. I’ve also estimated the stop points to the up-side and down-side. What I’ve done to estimate is using TOS and tweaking the price level and the volatility with a few basic assumptions:
For up-side swing: reduced volatility by -3% in the TOS analyzer
For down-side swing: increased volatility by +5% in the TOS analyzer
These are not perfect estimates, but I know they’ll get me around the ballpark of where I may need to stop/fully hedge the position. I plan on using that for next week’s trade.

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