After SPY’S opening gap, it was very trying trading in the early action as the ETF whipsawed back and forth across its open.
The market’s first ninety minutes chopped out two short signals and two long signals before settling into an downward trend for the rest of the day.
That slide into the close saved the trade for the day. After an initial draw down of $1500 (on a $10K buy-in on each trade), the overall net at the close was $7,900 for the day (or 79%) trading the weekly calls and puts (see the chart below for an illustration). Instead of saying the drop from 8 a.m. (PST) into the close “saved” the day, I guess it would be more apt to say it made the day-trade with this system once again great for the day.
I have upped the ante on what I talk about here from buying $5K worth per trade to $10K worth for each trade simply because it’s easier to talk about percentage gains and losses using that level. The SPY is best for this kind of options day trading because of the liquidity in both the weekly and the monthly strikes. The action today was in this week’s 266 calls with a volume today of more than 63,000 contracts and this week’s 267 puts with a volume today of more than 9,000 contracts, both were in the money contracts (that volume may be skewed by the fact this week’s expiration Friday is also a monthly expiration). Size ranged from 72 to 90 contracts per trade.
With $10 in the trade, it’s also fun to say on good days like today — Made $7900 today with my 10 grand in the market and now I’m flat with no overnight risk! What a fool am I?!
REMINDER: The commentary presented here is for entertainment purposes only and should not be construed in any way as direct investing or trading advice.