I believe that today was my worst day ever since I starting blogging in February 2006 as the stock market melts down and the Dow is down over 500 points. I am tempted to say "the pain, the pain," as a parody on the old Fantasy Island TV series where Tattoo opens the show with "the plane, the plane," when the guests are arriving.
It is kind of bizarro Fantasy Island, more like nightmare island. What I kept telling myself today was "stop digging." Most of my recent moves have just made the hole I am now in, deeper. I had some "brilliant" ideas for trades today, but resisted.
My current plan is to wait it out. Roll out to further months any short puts that are going to be expiring in the money. My short IWM Aug 75 puts are already deep in the money, and another day like today, and the SPY Aug 117 puts and even the Aug 112 puts are threatened.
SPY broke support at 125 and now projects to 113. This target is by taking the width of the range and subtracting that from the breakdown point (137-125 = 12 points wide, 125-12 = 113 SPY target).
With all that, and despite today's losses, I still have a good bit of dry powder, but am reluctant to take on any more risk. Fast markets are not my friend.
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