$SPY $QQQ – day trading weekly options, again up 100%

After the Nasdaq’s big up day to start the new year, all of my swing signal clicked again to buys.

See signals table below.

But the question for discussion today is what those swing signals mean for the day trades in what I’ve been calling the “Fool’s Game”, the practice of going long – LONG – calls and puts each day.

Today, with all swing signals in place, and intraday 10-minute signals on SPY and QQQ also on buys at the end of Tuesday, the buys for the day trade today were on the open.

From that point, a day-trading options player in this game wants nothing more than to not be stopped out any time during the day and to close the trade at the end of the day making money. If it turns out it is a strong trending day, like yesterday to the upside with the QQQ calls, then the day trade becomes a big, sometimes very big winner.

The initial stop loss would have been 10 minutes of risk. If the first bar of the day closed below the day’s open, the position would be sold, no doubt for a loss, and possibly reversed depending on its relation to the moving average. If the option finished above the open, it would be in profit and a stop-loss just below the open could be placed to make it virtually a free trade.

So how is this game going today?

The buy on the open in the weekly SPY and QQQ in the money calls have gone straight up so far for the day with the SPY 268 weekly call up approximately 80% at the moment, and QQQ weekly calls up about 118% (see the chart for an illustration of all of the above).

A 100% day trade…can’t ask for much more than that, but as always in trading it is take what you can get.

SWING TRADING SIGNALS:

LONG-TERM BREADTH: Buy (Day 11).

PRICE: Buy. (Day 1).
SHORT-TERM BREADTH: Buy. (Day 1).
VOLATILITY: Buy, (Day 1).

CONTEXT:

SPY CLOSE – 268.77
QQQ CLOSE – 158.49
CNN MONEY’S FEAR AND GREED INDEX: (62, rising, greed level).
NIFTY-50 STOCK LIST: 30 Buys; 18 Overbought, 0 Oversold, 17 new buys today, 5 new sells.

(click on the chart for a larger view)

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