FEYE appears to be in a Bollinger Band Squeeze. *The squeeze is on* This would be a debit of approx $1.50 if buying both options. FEYE could break out before earnings, but is most certainly trading sideways as of right now. Just an idea...
Skew this trade to the short side and sell more 235 calls, Chart says $TSLA is experiencing a short term top
$35 Call and $32.5 put . Backtest probability: 81.1% Sharpe Ratio: 0.63 (4 years of backtest)
-1 Call at 2090 -1 Put at 2010 Backtest probability: 83.5% Sharpe Ratio: 0.82 (2 years of backtest)
$1.515 Call and $1.455 put. Backtest probability: 76.3% Sharpe Ratio: 0.43 (2 years of backtest)
Details. Chance of success without back testing: 61% Chance of success with back testing: 91.9%
NFLX announces earnings on 10/14 after the market close, so look to fill any setups on 10/14 prior to New York's closing bell. Ordinarily, I like to work these via Iron Condor or short strangle (buying power permitting). Currently, here are the two setups I'm looking at: An October 23rd 89/92/134/137 Iron Condor POP: 71% Max Profit: $89/contract Buying Power...
I have a love-hate relationship with earnings plays. When they work out, I'm happier than a clam; when they don't, I swear off them, use expletives to describe them, and say that they're a total *?! waste of time. That being said, there are some I just can't pass up, usually because the premium is just too good. In the next couple of weeks, these will be NFLX,...
Now that FOMC is past, it's time for me to return to bread and butter trades, and these ordinarily are in TLT/TBT and the index ETF's -- SPY, IWM, DIA, and QQQ. Currently, TLT IVR (implied volatility rank) is 42. Although it isn't anything to write home about, TLT (or its inverse, TBT) is one of my bread and butter trades, and I'll put a trade on 25-45 DTE...
As a premium seller, I look to sell premium in high volatility environments or where the volatility in a given underlying (U/L) is high, and I use Dough.com's "Grid" with the drop down menu set to "TastyTrade" to screen for these plays, looking for IVR numbers that exceed 70 for individual stocks and 35 in ETF's, but naturally higher is better ... . However,...
LULU announces earnings on 9/10 before market open, so look to set up your earnings play prior to the 9/9 NY close to take advantage of the volatility crush the underlying's options will experience post-earnings. Traditionally, I take a nondirectional bias with earnings plays since I do not know how the announcement will turn out and do not know what the market...
If you want to play the Chinese markets, you're largely relegated to FXI or ASHR. So which do you play from an options standpoint? With IVR in FXI at 92 and at a comparable 89 in ASHR, is it a rock, paper, scissors type of decision? I would say "no," and for a very simple reason: liquidity. While FXI isn't great from a liquidity standpoint, ASHR is, quite...
With my broad index ETF (SPY, IWM, DIA, QQQ) queue kind of full, I've been looking at other high volatility plays to keep capital in play. One of the sector ETF's that has reappeared on my radar is IYR (iShares U.S. Real Estate ETF). With an IVR of 85, it is ripe for a premium selling play. Traditionally, I look for a setup that is around 45 DTE, which would be...
The more IV, the merrier if you're a premium seller. This week's earnings play in COST (Costco; announcing on 9/2 after market close), needs to be "merrier" if I'm going to make a play in it. Although it's IVR is currently 67 (52-Week TOS), I generally prefer to sell premium in an individual, non-ETF underlying if the IVR is above 70, and I would generally...
The SPY is squeezing inside of symmetrical triangle on the weekly chart which portends to a decent sized move one way or the other once price action breaks outside the triangle. Last week we outlined 2 possible scenarios which are still in effect: There's a higher probability that we break to the upside to hit all time highs. Or we break to the downside and...
Let's face it. No one really likes to roll their options positions to a later expiry, but sometimes you just have to, whether it is to give the trade a bit of additional time to work out or to mitigate your loss. Here are some basic guidelines I use regarding rolling where there has been a breach of a side of your iron condor or short strangle: 1. Always ...
The only earnings play on my radar for next week is BABA. Although there are others, I generally focus on those with good liquidity as evidenced by the bid/ask spread for the options I am looking for fills in (ideally, I'm looking for a <.05 spread, although I'm flexible with this, particularly with heavyweight underlyings like AMZN, GOOG, and the like). In...
Gold and gold-related underlyings were hammered this past week, along with other precious metals. The IVR for the go-to proxy for gold -- GLD (SPDR Gold Shares) -- has popped to >90, offering a premium selling opportunity that may quickly evaporate off of GLD sub-104 lows (GLD experienced a modest bounce in Friday's session, up .98% for the day). A Sept 4...