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I bleed maroon
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In reply to Heineken-Ashi • 10:28a, 10/2/24
AG
Heineken-Ashi said:
EnronAg said:
so, kind of a long winded question, but can the options experts shed some light...sold puts at $1.50...now those puts are trading about $0.45...these options do wonky pricing at end of day where the bid/ask spread will then show something stupid like $2 for the closing ask...how can I safely set a stop at say a buck, so I can guarantee myself a gain in the event it starts to plummet...but also, not trigger a buy on a stupid end of day fictitious price?
Stops in options is a fruitless endeavor. Money is made on options off the entry. I don't enter if I'm not willing to lose everything I risk.

I think instead of setting a stop, you need to highlight where the first resistance point would be. Buy enough up front that you can sell whatever portion is needed at that point to go net free. Then you can ride a risk free position and lose the stress.
This is good advice. My additional school-of-hard-knocks observation on quotes themselves:

Don't trust ANY options "quotes". They are even worse than penny stock quotes. It can use any of these methods, and none are accurate - you only should look at actual bid and ask offers, along with the volume of the offer:

1) Last trade: Ludicrously inaccurate, since it may be weeks between trades for some thinly traded options.
2) Midpoint of bid/ask: Also a bad measure, especially if the bid is zero, and the ask is 6.00. The midpoint of 3.0 tells you nothing about true value of the position.
3) Closing bid: Simply any open bid that is in effect at close - very likely inaccurate as to true value
4) Estimated value or "Mark": Some brokers attempt to give somewhat of a true assessment of value, using a combination of the above, but since the methods are all flawed in their own way, this one shouldn't be relied on, either.

Some options with highly liquid trading (SPY, QQQ, etc.) can get pretty close to trading like a stock, with enough volume to keep bid/ask spreads reasonable and quotes fairly accurate, but these are few and far between.

Bottom line - set your entry and exit point via limit orders, and wait for anyone (market makers or other traders) to meet you at that price. Until you are very near the expiration date, it's pretty much a game for the patient and disciplined trader - don't chase after false quotes.
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FishrCoAg
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In reply to EnronAg • 10:36a, 10/2/24
AG
EnronAg said:
so, kind of a long winded question, but can the options experts shed some light...sold puts at $1.50...now those puts are trading about $0.45...these options do wonky pricing at end of day where the bid/ask spread will then show something stupid like $2 for the closing ask...how can I safely set a stop at say a buck, so I can guarantee myself a gain in the event it starts to plummet...but also, not trigger a buy on a stupid end of day fictitious price?


If I read correctly you sold puts at 1.50 and they have now dropped to around .45. That's a 200 % gain. What I do is weigh the possibility of the stock dropping enough to make those puts cost more to buy them back considering volatility, time to expiration, etc. if you are happy buying them for 1/3 of what you sold them for, do it. That's a great return in everyone's book
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I bleed maroon
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In reply to FishrCoAg • 10:44a, 10/2/24
AG
FishrCoAg said:
EnronAg said:
so, kind of a long winded question, but can the options experts shed some light...sold puts at $1.50...now those puts are trading about $0.45...these options do wonky pricing at end of day where the bid/ask spread will then show something stupid like $2 for the closing ask...how can I safely set a stop at say a buck, so I can guarantee myself a gain in the event it starts to plummet...but also, not trigger a buy on a stupid end of day fictitious price?


If I read correctly you sold puts at 1.50 and they have now dropped to around .45. That's a 200 % gain. What I do is weigh the possibility of the stock dropping enough to make those puts cost more to buy them back considering volatility, time to expiration, etc. if you are happy buying them for 1/3 of what you sold them for, do it. That's a great return in everyone's book
Also good advice. My own options credo is unless you're specifically writing covered calls with the intent to close a stock position, or writing puts to achieve a lower entry price on a new stock position, you should treat options as a speculative leveraged play, with no intent to hold until expiration. Once you achieve your targeted return, cut 'em loose. Even in the two examples I note above, it may still be best to buy back the options you sold to achieve a return - don't completely lock in to your initial premise, as market conditions change. No one ever went broke by taking gains.
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harge57
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11:33a, 10/2/24
AG
Don't forget to update any stops for SMCI after the split.
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Heineken-Ashi
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12:38p, 10/2/24
Just placed an order to buy OXY at $52. Won't engage unless it comes and gets me. Stop is recent low just under $49.75. Target range is $57-$61 expecting lower end. Will be watching $55 closely as failure there could lead to $45 rather quickly.
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El_duderino
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1:38p, 10/2/24
Waiting on NvDA to break either way for a clear direction. Weekly and daily charts. Lots of volume on the December $130 call


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Heineken-Ashi
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2:37p, 10/2/24
Gun to my head - and I'm 50/50 in these scenarios - I think we drop into mid October and then relief bounce into and maybe slightly past election. Then fireworks.
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EnronAg
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2:44p, 10/2/24
AG
fireworks would tend to incline good...I think you need to find another analogy for post election
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I bleed maroon
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In reply to Heineken-Ashi • 2:46p, 10/2/24
AG
Heineken-Ashi said:
Gun to my head - and I'm 50/50 in these scenarios - I think we drop into mid October and then relief bounce into and maybe slightly past election. Then fireworks.
Correct me if I'm wrong, but if you are 50/50 with a gun to your head, how can you still be posting? Do I not understand Russian Roulette well enough?

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Heineken-Ashi
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In reply to EnronAg • 2:49p, 10/2/24
EnronAg said:
fireworks would tend to incline good...I think you need to find another analogy for post election
Think of the scene from the Patriot when they blow up the ship thats docked at the fancy party.. and the market is the british.
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Heineken-Ashi
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In reply to I bleed maroon • 2:51p, 10/2/24
I bleed maroon said:
Heineken-Ashi said:
Gun to my head - and I'm 50/50 in these scenarios - I think we drop into mid October and then relief bounce into and maybe slightly past election. Then fireworks.
Correct me if I'm wrong, but if you are 50/50 with a gun to your head, how can you still be posting? Do I not understand Russian Roulette well enough?

They're all blanks. But with theoretical bullets, ya, I'd be dead. That's why I don't trade these hunches without clearly defined risk management. Being wrong can blow up an account.
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ProgN
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2:57p, 10/2/24
Even with all my years of experience, this is honestly the most illogical market that I have ever seen. Nothing negative effects it. It's like 'whatever' and water off a duck's back.

1) SPX trading at 22+ times next year earnings projection
2) Longshoreman strike costing $5B day, everyday they're on strike
3) Iran launches 200 missiles in a direct attack on Israel.
4) Israel publicly stating that they are going strike back HARD on Iran
5) TA indicates it's overbought.
6) September and October seasonally the worst time for the markets

I just can't remember a time where the market has completely ignored risks and uncertainty like it's currently doing. I honestly don't know what will be the catalyst to bring reality back to the market, but I have zero doubt that we are in unprecedented and dangerous territory. There are going to be a lot of retail folks that will be destroyed when the music stops.

Random Prog thoughts
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EliteZags
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3:33p, 10/2/24
EliteZags
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3:33p, 10/2/24
AG


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ProgN
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In reply to EliteZags • 3:54p, 10/2/24
EliteZags said:


The thing that's different with your post is that snap move higher, that birthed this current bullrun, was when the Fed pivoted and indicated that the next move would be rate cuts. That followed historical norms. Actually, you inadvertently pointed out another point that I should've listed. Markets usually selloff after the first rate cut, but not this time. Powell all but said that they're only going 25bps next time they cut. Market dgaf and marched on. This melt up is also on paltry volume. Nothing about this current market makes sense and behaves like it's done for decades. That's also why I urge some caution and for you guys not let greed blind you. When the music stops, I don't want anyone here hurt.
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Heineken-Ashi
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In reply to ProgN • 4:08p, 10/2/24
ProgN said:
EliteZags said:


The thing that's different with your post is that snap move higher, that birthed this current bullrun, was when the Fed pivoted and indicated that the next move would be rate cuts. That followed historical norms. Actually, you inadvertently pointed out another point that I should've listed. Markets usually selloff after the first rate cut, but not this time. Powell all but said that they're only going 25bps next time they cut. Market dgaf and marched on. This melt up is also on paltry volume. Nothing about this current market makes sense and behaves like it's done for decades. That's also why I urge some caution and for you guys not let greed blind you. When the music stops, I don't want anyone here hurt.
2007 didn't start selloff until Oct 11th after 50bps on Sep 18th
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Chef Elko
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4:49p, 10/2/24
AG
Whenever the next 40% correction happens, I'll be there buying $50k of QQQ calls.
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Brian Earl Spilner
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In reply to Chef Elko • 4:51p, 10/2/24
AG
QQQ might go up more than 40% before that.
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Apache
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4:57p, 10/2/24
AG
Quote:
There are going to be a lot of retail folks that will be destroyed when the music stops.
I've been sitting on a pile of cash, waiting for the music to stop.
This market just keeps going & I'm trying not to lose my nerve and buy.
It will come down to earth.


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Chef Elko
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In reply to Brian Earl Spilner • 5:04p, 10/2/24
AG
Brian Earl Spilner said:
QQQ might go up more than 40% before that.
And I'll have made money all the way up. Sticking with my 80/20ish portfolio. Juice isn't worth the squeeze for me up here
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El_duderino
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In reply to Apache • 5:23p, 10/2/24
Back to earth is the 800ma on daily chart for me
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El_duderino
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In reply to giddings_ag_06 • 7:10p, 10/2/24
giddings_ag_06 said:
ProgN said:
Sell and take the money. Continue to stack singles and your account growth will surpass what you thought possible.

or ride it back down like you used to



This is kind of where I'm at. One kink in my trading is I work shift work so 5 days a month I'm sleeping through most of the trading day. That can burn you if you aren't on top of everything daily. I've been taking the domino game approach this year and just getting my nickels and dimes. They eventually add up to a big X with some little X's too.


Late reply, but I work the same shift as you. Using trigger with brackets or an OCO order once in a position is basically autopilot. Just need to have set stops/profit targets before entering a position and you're good to go.

Unless you use vanguard for a broker. Then it's a pain in the ass. Schwab/ToS has been great for the trigger with bracket or OCO orders.
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giddings_ag_06
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In reply to El_duderino • 9:56p, 10/2/24
AG
I'm with Schwab and have just been dabbling here and there. I just don't trust the computer with my money while I sleep.
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EngrAg14
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In reply to ProgN • 12:47a, 10/3/24
AG
ProgN said:
EliteZags said:


The thing that's different with your post is that snap move higher, that birthed this current bullrun, was when the Fed pivoted and indicated that the next move would be rate cuts. That followed historical norms. Actually, you inadvertently pointed out another point that I should've listed. Markets usually selloff after the first rate cut, but not this time. Powell all but said that they're only going 25bps next time they cut. Market dgaf and marched on. This melt up is also on paltry volume. Nothing about this current market makes sense and behaves like it's done for decades. That's also why I urge some caution and for you guys not let greed blind you. When the music stops, I don't want anyone here hurt.


Where have you been since Nov of last year?
Companies shot up by simply uttering AI at earnings or hinting some new AI thing.
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Brian Earl Spilner
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8:58a, 10/3/24
AG
SMCI moving.
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nancydeedavis
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8:59a, 10/3/24
Anybody in $CLOV?

9/30 news: SEC finished their 2021 investigation and no action taken.
Pretty good runway to $6.5-$7 resistance if it can break above $4.
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Gaeilge
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In reply to nancydeedavis • 9:01a, 10/3/24
Not worth the aggravation. So many better opportunities out there besides chasing that POS.
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nancydeedavis
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In reply to Gaeilge • 9:08a, 10/3/24
Didn't say I was chasing. Presenting an idea. Break above $4 and hold and buy (stop at $3.75ish?). Hold for run to up to 3 year ago support around $7. Pretty good risk/return but open to thoughts.
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El_duderino
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9:10a, 10/3/24
I need those shorts to knock POWL back down to earth so I can re enter
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CC09LawAg
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In reply to El_duderino • 9:12a, 10/3/24
I somehow regret taking a 4 figure % profit on my 220 calls. I thought for sure the run was over or it'd go sideways at best.

They'd be worth double what I sold them for.

I know I shouldn't do this to myself but man this one stings!
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Gaeilge
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In reply to nancydeedavis • 9:15a, 10/3/24
nancydeedavis said:
Didn't say I was chasing. Presenting an idea. Break above $4 and hold and buy (stop at $3.75ish?). Hold for run to up to 3 year ago support around $7. Pretty good risk/return but open to thoughts.
It is revisiting a meme stock. You're jumping into something that is still pumped by morons on X. 2020-2022 should've taught everyone that meme stocks just aren't worth it and there is so many better options that aren't at the whim of X posters
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El_duderino
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In reply to CC09LawAg • 9:15a, 10/3/24
You made an awesome profit. No need for woulda/coulda. That'll bite you in the ass down the road
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CC09LawAg
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In reply to El_duderino • 9:18a, 10/3/24
I know. I've been down this road too many times.

I don't think they'll let it crash at this point until the 10/18 option date passes - prob way too many people like me that loaded puts expecting it to follow the usual pattern.
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techno-ag
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In reply to Brian Earl Spilner • 9:31a, 10/3/24
AG
YMAX going to weekly dividend payout. They invest in all the other single stock option ETFs.

ETA YMAG too. They focus on the Magnificent 7 single stock option ETFs.
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I bleed maroon
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9:32a, 10/3/24
AG
I have a number of downside speculative orders active. So far, I have bought TSLA Dec. puts and CZR March puts. Anyone else have overbought ideas?
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