Re: [TheOptionClub.com] SPY Just Hit My Short Strike

 

Thanks for your input John.

"Hope"fully I didn't use the word HOPE in my original e-mail.

I agree with your message though.

I had a plan on how to manage the trade going in, but once I plugged the real numbers into options oracle, I didn't like the butterfly strategy anymore. I was about to do the trade today, but decided not to.

Rather than second-guessing or even having a market-sentiment, there is defintiely something to be said about purely mechanical systems or rules.

I could be wrong, but I don't like the butterfly adjustment. In this csae, it didn't seem to provide enough wiggle room.

So, next time I'm going to have a mechanical system and just buy back the position if it hits my strike, regardless what I think.

I setup alerts in TD Ameritrade. However, someone correct me if I'm wrong, but for their Trade Triggers screen, they don't have a method to close out the position. I.e., do two leg orders, just one.

Also, I hate how you can't do a two legged order GTC.

--- In OptionClub@yahoogroups.com, John Vogler <jmvogler@...> wrote:
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> Hi Justin,
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> I am no expert and am still trying to find my way, but I can say I continually hear about the importance of having a plan in place if the underlying moves one way or the other and sticking to it. H-O-P-E is a four-letter-word in trading I am told and "giving it one more day" is hoping for something positive to happen and at the same time hoping something negative does not happen. The lack of a plan allows emotion and indecision to enter into the process...not a good thing.
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> I find it is disappointing to have to close a position with little or no profit and maybe a loss after watching it for weeks but the goal is to live to fight another day.
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> As for what you should do now, I have no idea...perhaps someone with more experience wants to weigh in on that.
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> John
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> To: OptionClub@yahoogroups.com
> From: justin@...
> Date: Thu, 11 Mar 2010 02:06:48 +0000
> Subject: [TheOptionClub.com] SPY Just Hit My Short Strike
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> As part of my iron condor position, a few weeks ago I sold the Mar. 20th 115 Call and bought the Mar 20th 118 strike.
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> The SPY has been flirting around this price for the past few days.
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> I think there is massive resistance around this price, so I haven't done anything yet.
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> However, the options are expiring in less than 10 days, so I have a few options.
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> Since the options are expiring in about a week, I was thinking about creating a butterfly position, since the price shouldn't move past three or four points in the next week anyway.
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> Or, I could just sit on the position, as I think there is a good chance it will expire below the 115 strike. My only worry if this HAPPENS to be the week it breaks above this resistance level, it will be on good volume and a good surge.
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> I think we are due for a pull back soon though.
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> Thoughts or ideas?
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> Thanks in advance.
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> __________________________________________________________
> Hotmail: Trusted email with powerful SPAM protection.
> http://clk.atdmt.com/GBL/go/201469227/direct/01/
>

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