Navigating the storm!! That's what we're doing as non-directional traders, I'm rolling from one iron butterfly into another and already making adjustments on the SEP position.. I decided to keep on top of the AUG trade, rolling the PUT side down to cut delta and gamma exposure, now it all depends on how far this correction will be, one way or another, I think my chances are good of MNX staying in the profit zone for AUG.
Detailed Positions:
08/17 MNX Iron Butterfly - SEP
08/17 IBM Calendar
08/17 MNX Iron Butterfly
Monday, August 17, 2009
08/17 MNX Iron Butterfly - SEP
OUCH!! Taking a 2 standard deviation move right off the gates is never fun! This time we'll be testing the MNX, can it handle it?!? Can I handle one hard-core trade after another? I thought I'd get a break in the SEP contracts, well, this may be just the beginning of another long trade..
I was forced to cut deltas, my original plan was to leave the position alone, we broke the threshold of comfort, so I cut the deltas and am ready to keep with the market if we keep rolling down.
Position's History:
08/14 MNX Iron Butterfly - SEP
08/15 MNX Price & Volatility Study
08/13 MNX Iron Butterfly - SEP *New*
I was forced to cut deltas, my original plan was to leave the position alone, we broke the threshold of comfort, so I cut the deltas and am ready to keep with the market if we keep rolling down.
Position's History:08/14 MNX Iron Butterfly - SEP
08/15 MNX Price & Volatility Study
08/13 MNX Iron Butterfly - SEP *New*
08/17 IBM Calendar
I'm willing to go all the way for the 15% ROI. I noticed IBM did not fall as badly as the rest of the market, and its 1-hour chart was actually showing some willing buyers. I have my exit pre-set if we take a deep drop Tomorrow, otherwise I'll take it to the target.
Position's History:
08/14 IBM Calendar
08/13 IBM Calendar
08/12 IBM Calendar
08/11 IBM Calendar
08/10 IBM Calendar
08/07 IBM Calendar
08/06 IBM Calendar
08/05 IBM Calendar
08/04 IBM Calendar
08/03 IBM Calendar
07/31 IBM Calendar
07/30 IBM Calendar
07/29 IBM Calendar
07/28 IBM Calendar
07/27 IBM Calendar *New*
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Position's History:
08/14 IBM Calendar
08/13 IBM Calendar
08/12 IBM Calendar
08/11 IBM Calendar
08/10 IBM Calendar
08/07 IBM Calendar
08/06 IBM Calendar
08/05 IBM Calendar
08/04 IBM Calendar
08/03 IBM Calendar
07/31 IBM Calendar
07/30 IBM Calendar
07/29 IBM Calendar
07/28 IBM Calendar
07/27 IBM Calendar *New*
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08/17 MNX Iron Butterfly
I'm still in this trade! I guess that if MNX keeps on rolling down I'll take a small loss, otherwise, it will be a small win. One way or another, I rolled the 152.5 Puts to 147.5 Put. This trade is being a long lesson in stayig in the game. In past trades I would be getting out, this time I'm willing to take the dance to the last minute.
Position's History
08/14 MNX Iron Butterfly
08/13 MNX Iron Butterfly
08/12 MNX Iron Butterfly
08/11 MNX Iron Butterfly
08/10 MNX Iron Butterfly
08/07 MNX Iron Butterfly
08/06 MNX Iron Butterfly
08/05 MNX Iron Butterfly
08/04 MNX Iron Butterfly
08/03 MNX Iron Butterfly
07/31 MNX Iron Butterfly
07/30 MNX Iron Butterfly
07/29 MNX Iron Butterfly
07/28 MNX Iron Butterfly
07/27 MNX Iron Butterfly
07/23 MNX Iron Butterfly
07/22 MNX Iron Butterfly
7/21 MNX Iron Butterfly
07/20 MNX Iron Butterfly
07/17 MNX Iron Butterfly
07/16 MNX Iron Butterfly *New*
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Position's History
08/14 MNX Iron Butterfly
08/13 MNX Iron Butterfly
08/12 MNX Iron Butterfly
08/11 MNX Iron Butterfly
08/10 MNX Iron Butterfly
08/07 MNX Iron Butterfly
08/06 MNX Iron Butterfly
08/05 MNX Iron Butterfly
08/04 MNX Iron Butterfly
08/03 MNX Iron Butterfly
07/31 MNX Iron Butterfly
07/30 MNX Iron Butterfly
07/29 MNX Iron Butterfly
07/28 MNX Iron Butterfly
07/27 MNX Iron Butterfly
07/23 MNX Iron Butterfly
07/22 MNX Iron Butterfly
7/21 MNX Iron Butterfly
07/20 MNX Iron Butterfly
07/17 MNX Iron Butterfly
07/16 MNX Iron Butterfly *New*
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Saturday, August 15, 2009
AUG/09 Trades
I hit a rough spot in August. Looking on the positive side of things, I preffer to think that I spent some money to discover that there are only a few strategies that are making money for me in this environment. Does it mean the other strategies don't work? Of course not! All it means is that perhaps they don't work for me! The best thing about trading is that we all do it a little bit differently, and therefore, there is room for everyone.
Position's Details:
08/04 RUT 30-Day Iron Condor
08/03 SPY Double Diagonal
08/18 IBM Calendar
08/19 MNX Iron Butterfly
08/15 MNX Price & Volatility Study
I forgot to even run this study a couple days ago when I entered the MNX Iron Butterfly for September. It is one of those things: When you're following the index for a while, you kind of have a feeling for what is going on.
One way or another, what do I see on the picture bellow? I see that MNX has settled down for a few weeks. I hit a rough patch on the AUG trades, but there are less strong price moves than earlier on. Does it mean everything will be just fine? Of course not! It is just an acessment of how rough the waters are before we jump in.
I didn't run the VIPES study for the AUG/09 MNX Iron Butterfly, if I had, I would have seen I was sailing much more rough waters, take a look at the current study in contrast to last month's. Things I note:
1) This month we are moving from stronger price action in the 60 days chart, to a more quiet environment in the 30 days chart. It was the opposite situation last month.
2) This month we have just survived a bigger 5-Day Volatility wave, notice how this wave was just getting started last month.
What I want to be able to do in the future is to use this study to gauge how I should allocate capital. By collecting this data I can pretty much make inteligent decisions about my business. I can decide when to enter more or less capital in the market depending on how the environment is using a very objective perspective.
One way or another, what do I see on the picture bellow? I see that MNX has settled down for a few weeks. I hit a rough patch on the AUG trades, but there are less strong price moves than earlier on. Does it mean everything will be just fine? Of course not! It is just an acessment of how rough the waters are before we jump in.
I didn't run the VIPES study for the AUG/09 MNX Iron Butterfly, if I had, I would have seen I was sailing much more rough waters, take a look at the current study in contrast to last month's. Things I note:
1) This month we are moving from stronger price action in the 60 days chart, to a more quiet environment in the 30 days chart. It was the opposite situation last month.
2) This month we have just survived a bigger 5-Day Volatility wave, notice how this wave was just getting started last month.
What I want to be able to do in the future is to use this study to gauge how I should allocate capital. By collecting this data I can pretty much make inteligent decisions about my business. I can decide when to enter more or less capital in the market depending on how the environment is using a very objective perspective.
08/15 Key Postings
This post collects some of previous entries where I explained some of the tools I use on my options trading. I'm also using this to gather key information regarding the strategies I'm currently trading.
As you might already know, I have decided to focus on trading just two strategies between now (SEP) and the end of the year: Iron Butterflies and IBM Calendar. My goal is to simplify the business so I can focus on the strategies that are working best in the current environment. I'm also dedicating a portion of my capital to Day Trading FOREX, and keep a separate blog for those trades as they are very different from the options strategies I use.
Key postings to read:
12/30 Decision-Making Process: Should I stay or should I go? - Posting in details on how I used the decision tree tool for evaluating adjustment alternatives vs. closing vs. doing nothing on a trade that was under water.
XLE Decision Making - Another example of using a decision tree to evaluate adjustment alternatives.
09/04 TOS Contingent orders - How do I set up my contingent orders in TOS
09/03 Tools in the toolshed - A collection of sites I use as resource for my trading.
When do I cut Deltas on Iron Butterflies? - My answer to a frequent blog question
I Can See Clearly Now - Explains what I see as the current environment, and how it differs from past higher volatile periods
Trade Monitor day-by-day - Explains how I compose the daily charts that I use to track my positions
Understanding the Volatility Cone - Explains how I create the volatility cone
My VIPES spreadsheet Explained - Explains this Price action and volatility study
As you might already know, I have decided to focus on trading just two strategies between now (SEP) and the end of the year: Iron Butterflies and IBM Calendar. My goal is to simplify the business so I can focus on the strategies that are working best in the current environment. I'm also dedicating a portion of my capital to Day Trading FOREX, and keep a separate blog for those trades as they are very different from the options strategies I use.
Key postings to read:
12/30 Decision-Making Process: Should I stay or should I go? - Posting in details on how I used the decision tree tool for evaluating adjustment alternatives vs. closing vs. doing nothing on a trade that was under water.
XLE Decision Making - Another example of using a decision tree to evaluate adjustment alternatives.
09/04 TOS Contingent orders - How do I set up my contingent orders in TOS
09/03 Tools in the toolshed - A collection of sites I use as resource for my trading.
When do I cut Deltas on Iron Butterflies? - My answer to a frequent blog question
I Can See Clearly Now - Explains what I see as the current environment, and how it differs from past higher volatile periods
Trade Monitor day-by-day - Explains how I compose the daily charts that I use to track my positions
Understanding the Volatility Cone - Explains how I create the volatility cone
My VIPES spreadsheet Explained - Explains this Price action and volatility study
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