Trading Activity

I have added 3 new Earnings trade since my last update here:

  • RF Micro  $RFMD  I am Long the November 12/13 Call Spread. Options Net: $1.195
  • Ruger  $RGR  I am Long the November 47.5/45/42.5 1×2 Split Put Ratio with short stock at $43.65 (tag along but could become a hedge)
  • Expedia  $EXPE (noted the info on the trade on a prior post, it will expire today)

Options Expiration (weekly) plan

I have a few trades with expiring weekly Options today:

Earnings

Twitter  $TWTR  I am long the October 31 weekly 48/44/40 Put Fly & short stock at $43.78 (hedge). I will let the 48/44 PS auto-exercise (collecting $4) and the short stock will get assigned (so would then be flat the stock). The long $40 Puts will go poof. This should create an Options Net of $4.04 & stock gains of $.36

Expedia  $EXPE  original trade: Long the October 31 weekly 80/85 1×2 Call Ratio with short $73 Puts. I have already StC (Sell to Close) the $80 Calls for a $5.10 credit. I have added a Buy Stop at $85 to protect the short $85 Calls (2x) today (but expect them to expire worthless). The short $73 Puts will go poof. Options Net: $4.90

Submarine Basket

United Rentals  $URI  I own the October 31 weekly 95/102/109/89 Risk Reversal Call Fly with long stock at $105 (since 10/21). Options Net is currently: $4.38

Yelp  $YELP  I am long the October 31 weekly $55 Puts (part of a Put Calendar). These should expire worthless. Options Net: $.32

Submarine Basket update

Some material changes in the Basket this week:

  • $LVS  This position was exited on 10/28 with an overall gain of $1.07
  • $SKX  This is a new long stock position as of 10/27
  • $TEN  This is a new long stock position as of 10/27
  • $TSCO  I have StC the November 60/65 CS & bought a November 70/75/80 Call Fly (as of 10/29). Options Net is now: $2.82 & stock gains of $1.11
  • $WWE With the weakness today I exited the position (had held since 05/16). Overall gain: $3.54

 

StC = Sell to Close

Using RSI as a trade signal starring Workday

part of the Simple Approach series

 

Sometimes a chart provides a very clean look at what happens at key moments. For an example, let’s take a look at how price reacts when RSI gets near the 70 level (over-bought) on $WDAY:

WDAY_D

Now you have to consider the following:

1) Double Top?
2) Cup is built so does it build a handle now?
3) Just a normal Inside Day today
4) 50/200 SMA congestion

50/50 Basket update

I came into this week with 0 positions and a thin scan list. However, I was able to finally get 2 trades initiated when both saw some profit taking, peaked (one with VERY high RSI):

I have since added a November 20/17.5 Bear Collar on $RGLS (for a 1.45 credit). I have a Stop on $NLNK at $36.