No major change Today, except I had to update my trading plan as if we trade lower Tomorrow I will need to add a stronger put to compensate for the delta and Theta, this makes me tweak the adjustment on the second level down (do a strangle instead of selling the long Call) because of margin in one of my accounts. Other than that, one more day moving along well. Today's volatility went higher after the close, this kept Today's profits at bay, let's see what Tomorrow brings.
This is the quiet after the storm.. Let's hope so, this way I can land this trade with profits. So far it looks really good, a very positive recovery Today. I'll start peeling spreads out of the position either Tomorrow or Thursday morning, my goal is to keep the gamma exposure under control during these last few days of the trade.
We are still navigating this storm. For the past 10 days, 6 were higher than 1 standard deviation and this causes the position to halt its recovery from day to day.. On the bright side I'm still in the game and as long as I can still make a profit I shall stay in the game. Come on NDX, let's settle down, will ya!?!
First of all, a HUGE THANK YOU for all of those who posted your comments and emails on Yesterday's posting. Your support is a major part of my trading business, it keeps me going. Knowing I have the blog and the commitment to post whatever is going on with my position is truly a major benefit for my own trading.. You give me as much as I give you, if not more!
Today my dear reader, is my worst day in the trading business thus far! Don't get me wrong, the contingent orders did what they were supposed to do, I did my job with the plan last night, yet the modeling I had Yesterday failed to reflect the true life impact of a gap up + continuation of Today. The blow to the trade P/L was much higher than forecast, and all I have left to do is execute an orderly retreat. My job now is to take my risk off the table. Perhaps the spreads are just wide? Who knows, I'll see what Tomorrow looks like in the morning, but at this point the thing to do is start peeling off spreads.
A few quiet days will be very well received! I finished the cut and roll and add the extra butterfly to my position Today, this puts me in position to recover if the market stays quiet. NDX, let's stand still for a few days, how about till Tuesday? :)
Hanging on to those Puts really paid off Today! I was ready for any sort of down-side. I've been watching the last two up-side days and recognizing they were happening at lower volumes I kept my bearish bias and did not jump on the hand grenade by selling the puts too quickly.. Now I'm in a good position to finish cut and rolling, add the extra butterfly and push this trade to recover. If we stay quiet it will bring me my goals, if we keep moving around I can continue to manage it. It is a matter of time now to have theta kick in fast.. I also can't wait too much before adding any extra butterfly, as a matter of fact, am brushing with the limit to add new butterflies, I think it is still ok considering the volatility Spike from Today.
