The $SPY $10K day trade for 26.7%

Just a quick note on the $10K SPY options day trade for Thursday.

The long signal triggered just after the open and rose to a 97% peak (see the chart below) and closed the day up 26.7 percent, $2,670 for each $10K trade (see the white profit flag on the lower right). The is the day trade, start to finish.

Note, though, I consider a 100% gain a “trending day”, which are obviously the most important days to capture. Had this position passed above that threshold it could be locked in that profit level with a trailing stop. Just missed it today. Shucks!

However, it also should be noted that light blue candle after the peak on the chart was a chance to take at least some profits – the $10K was up 56.9% at the point. Short-circuiting the day-trade has not be more profitable over the long run this year than just letting it ride, but there at times when it just looks so obvious…

These trades are all day trades, either in the nearest in-the-money SPY calls or puts (in this case the 283 call, expiring Friday, and are closed at the close of each day. There was no signal for the puts today but on some days there are both calls and puts in play. My entry signal is proprietary, and should be tuned to any individual trader’s courage and risk tolerance.

Keep in mind, these posts are only for entertainment and educational purposes and should not in any way be construed as trading or investment advice.

The $10K Day-Trade – $SPY Options on Fridays

This is all about buying calls and puts for day trades.

And again, ITM 261 SPY weekly option, expiring today, has vaulted past 100% for the day for another trending day (see other posts below).

The white flag on the lower right of the chart below is the dollar gain today so far per $10K traded, also the percentage gain.

The key to these trades is they are day trades in the most liquid call or put, in or at the money, on the nearest expiration to minimize time decay and to get the biggest bang for the buck; using whatever entry a trader is comfortable with, using a stop loss to guard against big losers; and finally taking full or partial profits when one has them, on a breakeven reversal, or on a trailing stop, or into too much strength, but no later than the close of the day.

The day trades on Friday have accounted for 57% of the gains this year.

(click on the chart for a larger view)

Playing the Nasdaq drop in the weekly $QQQ puts…

The Nasdaq sold down hard right from the start today, and that is a day-traders dream in weekly options.

The system I’ve been developing a system for day-trading weekly options with a mere $5K in capital on each trade on the major ETFs SPY and QQQ has its main premise discussed here:

Buying options – is it a “fool’s game”?

Today, the QQQ puts put on the show. And an almost completely incredible show it was!

The drop in the Nasdaq (the composite would close down 87 points) began on the first five-minute bar (see charts below) and quickly became a bloodbath before leveling out in the usual mid-day to the close sideways chop. At the peak of the bloodbath, the gains in the weekly puts were astonishing and even with the leveling and sideways late in the day they remained spectacular.

My main trade was in the in-the-money 157 put, expiring Friday. It peaked at 330% and closed he day up 210%. Great, great as trades go, a definite home run, but on days like today, the in-the-money is the “conservative trade.” Out of the money has possibilities beyond home runs, beyond hitting it out of ball park itself…more like hitting it clear out of town.

See the charts below: the closest out-of-the money QQQ put, the 156, peaked at up approximately 395% and closed at up about 345%; the next strike, the 155, peaked at up 844% (about $42K on a $5k trade!) and was up about 585% ($29k on the $5k) at the end of the day trade. I don’t even want to talk about the 154, the next strike’s peak and return, in which on would have to buy nearly 500 contracts at around 12 cents each.

The “approximately” and all of the “abouts” in the above paragraph are because I didn’t trade those out-of-the-money positions. I just charted them to see the “entertaining” returns (see charts below). Out-of-the money options two days before expiration are really just wild-ass gambles while in-the-money can be methodical.

Remember all of this is just a journal for me alone and presented for no more than entertainment purposes here and should not be construed in any way as trading or investing advice.

(click on the charts for a larger view)