Saturday, February 25, 2017

Weekly: Elephants on the move

The rally rolls on. The DJIA is now at 11 record high closes in a row. Something that hasn't happened since 1987. 1987 had the huge October crash. There was a euphoric run up before the crash, and the recovery was also relatively quick. It feels like a difficult market to trade. However, the elephants, the big money is buying virtually every day. One reason is that so many were under invested before the election. More than a few sold at resistance levels, thinking a pullback was a sure thing. 
My take is that the public and talking heads remain skeptical, even though the newsletter marketvane is at nose bleed bullish levels. The AAII sentiment, which is mostly long term oriented, experienced, individual investors is right at the long term average of 38.5% bullish.

This week, I got back into NVDA with a short strangle, and initiated a position in NTES (rather badly I might add). Here are the trades (sell means sell-to-open, p = puts, c = calls, number at the end of line is price per contract.

Tue Sell BRKB Mar31 165 p 133
Sell IWM Apr 125 p 56

Sell DIA Apr 190 p 58
Sell BA Apr 155 p 48

Thu Sell NVDA strangle: 
Sell NVDA Mar 80 p 15
Sell NVDA Mar 122 c 19

Sell SPY Mar31 220 p 45

Sell NTES Mar 330 c 55
Sell NTES Mar 255 p 60

Sell IWM Apr 151 c 15

Sell TIF strangle: 
Sell TIF Apr 75 p 42
Sell TIF Apr 105 c 32

Sell DIA Mar 200 p 37

Fri Sell BA Mar 165 p 28
Sell NTES Mar 262.5 p 68

Saturday, February 18, 2017

Monthly: Half a loaf and TINA, 59-4 Grade B

The bull market roars ahead. SPY is up 5.2% for 2017. My trading account is up 3.7%, so I am lagging. IWM is up 3.2% so I am in the game. Overall, it feels like I left money on the table. I usually lag if there is a big upside move, so it is not unexpected.

Here are some etfs year to date, best to worst:

SLV +12.9% silver
EEM +9.7% Emerging market stocks

GLD +7.4% gold
SPY +5.2% U.S. large cap (SP500)

IWM +3.2 U.S. small cap (Russell 2000)
TLT +1.0 U.S. 20 year treasury

My trading account +3.7%. This remains the most hated bull market that I can remember. A lot of people are still nervous, many have sold or are still on the sidelines. This is not the sentiment at major market tops. A correction of 5% can happen at any time, but a bigger decline remains extremely unlikely.

Why is the market up? A lot of people shorted the market. There is also TINA, there is no alternative. With bonds underperforming, CDs still paying relatively low rates. People with money have to put it some where. A bit has been flowing in precious metals with gold, and silver among the best performers for calendar 2017.

Friday, February 17, 2017

Weekly: Short Covering

As the rally accelerates I scramble and cover a couple of short calls on COST and DIA. It was a frustrating week, even though I ended up slightly in the green. My initial position in NVDA was spot on, but I exited my long leg on earnings day. 

The feeling is like a baseball hitter what he thinks is a home run and trots to first base, only to see the ball careen off the wall, and be stuck on first base. As is almost the case, I am lagging behind during the sharp rally.

Here are the trades (p = puts, c = calls, sell means sell-to-open, cover means buy-to-close, number at the end is price per contract.

Mon Cover (buy-to-close) BRKB Feb 165 c 108 for a 27% profit on this leg

Roll BRKB Feb 160 c to Mar 165 c -255 debit
Cover (buy-to-close) BRKB Feb 160 c 555 -125% loss on this leg

Sell BRKB Mar 165 c 300
Sell SPY Mar3rd 224 p 26

Sell DIA Mar 197 p 73
Sell SPY Apr 212 p 70

Wed Cover DIA Feb 206 c 56 for a 200% loss
Cover SPY Feb 205 p 01 for 98% gain

Sell COST Mar 165 p 75
Sell BRKB Jun 150 p 107

Thu Cover COST Feb 175 c 97 for a 260% loss on this leg
Cover SPY Feb 216 p 01 for a 96% gain

Sell NTES Mar 250 p 76 earnings

Friday, February 10, 2017

Weekly: More new highs

Market continues to bull ahead. These posts are sounding familiar. I am positioned a bit too conservatively. I add some long delta as the rally rolls on. Here are the trades (sell means sell-to-open, p = puts, c = calls, number at end of line is price per contract)

Wed Sell NVDA backratio for nothing:
Buy NVDA Feb 108 p 204
Sell 2x NVDA Feb 103 p 104 each

Sell PNRA strangle: Sell PNRA Mar 215 p 89
Sell PNRA Mar 255 c 32

Thu Bull is leaving without me, so I add long delta:
Sell IWM Mar 124 p 39
Sell SPY Mar 215 p 45
Sell DIA Mar 190 p 47

Fri Cover NVDA Feb 108 p 32 for a 80% loss on this leg
I am thinking the Feb 103 puts are safe
Sell BRKB Jun 150 p 152

Saturday, February 04, 2017

Weekly: back to the highs

Stock market is back to the highs. That minor dip might all we get. February averages maybe -1.6% and that was about the size of the intraday dip. I remain cautiously bullish, a bit under invested given my bullish mood.

Here are the trades (p = puts, c = calls, sell means sell-to-open, number at the end is price per contract)

Mon Sell IBM Feb 185 c 12
Sell IWM Mar 115 p 25

Sell BA Mar 180 c 28
Sell AVGO Feb 220 c 30

Sell DIA strangle: 
Sell DIA Mar 180 p 40
Sell DIA Mar 208 c 18

Tue Sell GD Feb 170 p 47
Sell CAT Feb 86 p 14
Sell AAPL Feb 110 p 30

Thu Sell COST Mar 150 p 43
Sell WYNN Mar 115 c 27
Sell MSFT Mar 67.5 c 14

Fri Sell V Mar 77.5 p