41 replies to this topic

[arbman]

Yes, I WILL SHORT THIS MARKET, mark bookmark this. There is a point where there is downside possibility, but you buy anyway, there is a point there is upside possibility, but also a consolidation, you buy anyway, but then there is the point where buying gets silly. So, how do I trade this? I have one calendar spread in calls (premium+directional exposure), one futures short (the big hedge), and one vertical short in puts (collects premium). So, I am fully invested up to 1660 or so, also fully hedged down to 1580 for May... If it runs over 1660, I will get automatically short as the short calls will begin to assign... The best way to take your emotions out of the way is to sell way out of the money options... I am making money from the premiums regardless for anything in between... It is obvious that any volatility within the 1580-1660 range is a consolidation etc and it will be very noisy to predict. Anything below 1580 ends this parabolic advance, it may lead to a deeper pull back. So caution advised there. OTOH, anything above 1660 will be also pure euphoria and you have to force yourself to sell there... At least this was my trading plan until early June, then I will see how this unwinds or leverages further. Either way, the equities are quickly approaching to an unstable state in my opinion.

Edited by arbman, 14 May 2013 - 02:33 PM.

[fib_1618]

I WILL SHORT THIS MARKET,

And so will I...once money begins to move to the exits.

But until then...

Fib