Black Friday 11-28-14

Futures markets open for a half day on this holiday. I didn't expect much of anything happening. So I didn't write a plan except I had ideas of sell bull puts in indices and watch for grains prices to see if any new developments. Well, I was wrong again. Expect unexpected although it doesn't happen all the time.

Indices futures started a mini sell off 2 hr before closing. RUT ended down 1.5%. SPX pulled back some at closing but it breached last two days' lows. We may see a pull back next week. I had a Dec 18 1950 bull puts filled unexpectedly at $315 today. I had a 1955 filled yesterday which I didn't know about. The platform didn't show it nor popped a notice yesterday. I need to take one out next week with b/o or better if I can. I ended up sold a RUT Dec 24 bull put naked and rolled up SPX bull put to 1830 to lock in more profit. 

Grains had wild move today. I think it was Dec contracts' first notice related. Trades had to move out their Dec positions before get assigned. Soybean popped and then dropped 3%. Corn also tested both side of yesterday's range but closed only down 2c. It's more of a doji bar. Wheat broke out to the upside reaching its Fib 23% target from the last up swing on daily or hit Fib 62 RT from below on weekly. It closed up 2.8% after retest yesterday's range. The breakout may be US cold weather related. News from other major wheat producing countries were bearish. I will keep a close eyes on it next week. I roll up couple wheat bear calls from Jan to Feb since they were at 3X losses and locked in profit for a bull put Mar 550. I also closed puts in corn and soybean as my stop loss+reversal orders got hit. I need to make a habit of checking my pending orders each morning. 

Thanksgiving 11-27-14

It's Thanksgiving day in the US. Only indices futures market open for a half day as the markets that I am trading. ES made a new high of 2075.25 overnight then pulled back to yesterday's range. I don't expect much of anything happening unless a big news breaks out. I am trying to sell a Dec 19, 1955 put in S-5.

Grains are closed today. I am taking time to read some articles about the markets.

My play:

No trade was done today.
Spent time to match my Dec soybean trade records. It shown my current loss is -10K. I sold some ITM losses at the lowest points. The plan was to added them back but no quantitative specs. Looking back I was very  slow to realize the trend change.

The Day Before Thanksgiving 11-26-14

My plan:

Indices futures held the ranges of yesterday. I don't expect a large range or a new high in the day before Thanksgiving. I will try to sell puts if trades let the markets pull back some.

Grains moved up somewhat overnight. Soybean and wheat broke last swing highs. I need to prepare for longs. Corn is challenging the swing high on daily. I will watch it for directions.

My play:

Indices had no pull back. ES tested overnight low earlier then pushed to a new high of 2074.5 after cash close. I am glad I exited my 2075 bear call yesterday according to my plan. It's only less than 30 points to 2100. I want to consider to exit my ES, SPX bear calls in next few days. I tried to sell bull puts in S-5 but missed it by 5c. My order for roll up and locking in SPX 1870 to 1920 didn't get fill. I will try it again. Seasonally ES/SPX has another 1-1.5% to go upside.

Corn and wheat held their overnight gains well. It didn't make sense for wheat to break out with poor export data and high price already comparing with other major producers. I did several rollovers and profit locking. Corn is the one giving me headaches. There are not much premiums for far OTM nor the opposite of my positions. I am still hesitate to go long with force with concerns of the 2nd shoe to drop.

Good Time Continues 11-25-14

My plan:

ES moved to the upside after European open and broke yesterday's high on 3.9% GDP VS 3.3 expected. The all time high of 2072 set on last Friday is expected to be broken. My ES exit order for 2075 didn't get filled overnight. I need to get out no later than tomorrow. I won't sell any bear calls unless there is a sign of exhaustion. I will try to sell puts on any weakness.

Grains are supported by export data. Soybean export continued on strong numbers. It broke the neck line of IHS. Watch for the upside in soybean which is pulling with soy meal. Wheat recovered from weak export data. Corn is weak and forming a HS on daily. I will continue to adjust my positions.

My play:

Indices held well as thanksgiving approaching. I closed my this week's 2075 bear call B/E which is much better than losing money. I also sold a Dec 1950 bull put in QII. I got frustrated for no fill of credit spreads in this low volatility environment. SPX/RUT have large spread in bid/ask in far OTM and time listings.

Grains popped up every where with good export data especially in soybean complex. I rolled over or close a position in each product to lock in some profits or stop loss measures. It ended up as a B/E day.

Monday But No Trend Change? 11-24-14

My plan:

Indices opened in range on Sunday. They are holding well the uptrend. The seasonality is up in the holiday season. I will be careful on any bear calls and only look at least 2% above. I will look at SPY, QQQ for small size and spread to fill on any weakness. I may have to take my 2075 ES bear call out since it is not within a daily range. My next up target is 2080 and 2100 on daily and weekly BB charts.

Grains are in range since opened on Sunday night. All the three appears forming a IHS after the option expiration week. I will use the consolidation period to adjust my risky options and lock in some profit for the good ones.

My play:

ES/SPX had a less than 6 points, small range day. I didn't have any trade for indices other than tried to exit my ES 2075 bear call according to my plan. But it didn't get fill. It's been so hard to trade indices lately.

Grains closed down other than unchanged soybean but no major breaks. I rolled over bear calls in corn and wheat following my plan. The bigger question is that if the other shoe is going to drop? I need to study the charts more and come up with two hypotheses. My current positions of bulls and bears would likely to cause one side to lose.

 

Weekly Review 11-22-11

Monthly options expired this week. The draw down continues!

My biggest mistake of the week was held and hoped for my ES 2015 bear call to the end. I throw away my rules and discipline only thinking about give me a down day and I would get out. There was no down day for the week but a continued up thrust. I ended up lossing $1900, 18X of loss for this position. As I indicated in last weeks review and plan I have to overcome the psychological barrier of taking stops at 2-3X of loss. Without this firm rule and discipline I won't make it in this business. For the week this rule didn't stick to me. I must enforce it firmly until it becomes my 2nd natural. I am tired of lose big and win small. 2-3X loss is manageable.

My majority losses are from grains. I kept rolling over my positions. I exited many of the big losers before Oct USDA report to avoid the big drop that many experts were expecting. The record high production ended the low of this year before the Oct report. The long term seasonal charts played out exactly as they had happened before. I exited out these positions based on risk control although the timing was at the maximum pain point. What I didn't have were the specific quantified plan on getting back in and the flexibility of recognizing the trend change. While waiting for the other shoe to drop in Nov USDA report I didn't have both side hypotheses. I was still heavy in short side. Most of my directional put ended up losing money.

My plan for next week:

1. Continue to write out my daily plan in the morning;

2. Take stops at 2-3X regardless what is my outlook of the market direction;

3. Reduce my exposures in grains since I don't have a clear view and strategy of this sector. I will come back later or make my recovery from other markets. I need to ditch my anger or other emotions from this sector. I have to be able to admit that I lost this battle but I will preserve my capital in order to win the war.
 
4. Revisit indices ETF weekly options. The big index options have large spreads and are often hard to get a fill unless the market has a big movement. I will use these ETFs in my personal and IRA account for a short time frame and smaller gains. It's better than nothing with good risk management.

Markets Teach You in Hard Way 11-21-14

My plan:

ES gaped up 18 point on ECB talks overnight. It was a continuation of yesterday's close. My 2015 looks so low down there and deep in the water. Market has a way to teach undisciplined participants hard lessons. I am sitting at a possible 8X loss over my original stop limit. I have been hold and hope while drowning. I must exit this position before 3:30 as I expect an unwinding options toward later today. The risk is that it may go higher since the market is so energized. I may sell a put or call to recover partially.

Grains have held most of yesterday's range. They may have more upside to go. My goal is to rearrange my positions to reduce risk.

My play:

My hypotheses one played out in ES today. ES/SPX started falling after a brief high this morning. I was able to exit my 2015 only one point higher than today's low. The damage is still severer compare $1900 vs 1500 would have been yesterday and 1100 last week. I still don't have what it takes to take stops and win this game. It's up to me to overcome this barrier. I had only one 1940, Dec 12 ES bull put got filled. We may see some put back next week if today's high is really a head fake. The rejection of high looked decisive but being an options expiration day maybe misleading.

Grains had similar price pattern as Indices on this expiration day. Other than soybean against the pack closed at high of the day, corn and wheat gave up most of gains today. I tried two new strategies: Risk reversal and debit spread. I have been learning debit spread for a week but haven't quit figured out the exit part. Risk reversal was discovered while buying directional options with consideration of reducing cost. It should be used carefully since it could cost loss in both side if a major change against me.

Same Patterns? 11-20-14

My plan:

ES pulled back below yesterday's low overnight. Is it the relief I have been waiting for or just the same pattern of lower overnight and pop back during the day season? It looks like later during the first hour of RTH. ES/SPX closed a 10 point gap and challenging overnight high now. There were some good numbers in housing but unemployment claims was up 5K. Philly Fed manufacturing index was at 40.8 vs expected 18.9, Unreal? Well, it looks like my hope of a relief is gone. I have to take the 2015 call back with a big loss. I may try to sell another call to later of just get a put to recover partially.

Grains popped up cross the board. I will continue to rollover and lock in profit where I can. First, I need to search to see if any news behind the pops or just technically based.

My play:

The pull back didn't happen despite the lower low set overnight. The same pattern of down at night and up on the day played out again. I didn't get any fill except a error for RUT 1100 put spread for Dec 11. I forgot to key in the "-" symbol so it turned into a market order at $68 instead of $95. I must exit the position soon. I closed two ES puts to release margin for new positions but ES had no pull back today at all. I didn't get fill of my 2015 call which failed my plan again. I have to take it out tomorrow regardless the cost.

Grains pulled back with corn being strongest of 3%. I didn't see any news to cause it. Get to watch to see if it's a trend change. I rolled up 2 Feb 1180 soybean bear calls to 1170 to lock in 60% of profit. Also tried a new technique of reversing a losing position in my corn call to recover part of loss. This technique should be only used in far out of money and not too far from expiration.  

Waiting for Fed Minutes 11-19-14

I was later again today. I woke up couple time overnight which doesn't happen often. Is it a sign of aging?

I decided not to trade indices today before Fed minutes release at 2 pm. So I spent most of my time on grains this morning. ES/SPX pushed down after open to clear the deck It stopped right at yesterday's low and lifted back to mid before the release. The minutes didn't have any surprises. Indices ended with no change maintaining the uptrend posture. RUT is the only one down almost one percent. However it alone didn't stir up much volatility. None of my naked bull puts or credit spread got filled. I just have to wait until the right time comes. I need to close the 2015 bear call in S-5 tomorrow and try to recover partial from it.

Grains broke down today. Corn had -2% and both soybean and wheat were down more than 1%. I close couple wheat and corn positions. I tried to lock in some profit in soybean bear calls but didn't get fill. I am still not clear how to deal with my corn bear calls. There are not a lot premium to roll out plus my positions are still deep in the water. I will study it again tomorrow.

Move Up When It Can't Go Down 11-18-14

My plan:

Indices couldn't go down yesterday indicated their upside potential. SPX touched many's target of 2050 after open this morning. ES made a new high of 2048. Bollinger Bands on daily show there are more room to the upside to 2060 area but MACD is falling. RUT is holding its bull flag recovered yesterday's loss. I will try to sell SPX, RUT bear calls spreads on a surge with smaller size. They may be at higher end of current balance range.

Grains opened lower in small range. Corn is retesting yesterday's low and the low of current CLVA. Could it go down from 375 to 365 of CHVA? I will watch for it and get out some bear calls if it happens. Wheat is forming a HS in daily. I will get some relief if it plays out. In the meantime I will roll over some bear calls up or to the bull puts. Soybean is retesting yesterday's break out area. It looks like a IHS to the upside or holding the low of last Friday. I will play the same strategy of wheat.

My play:

ES/SPX shoot up to reach the psychological target of 2050 in the first 2 hrs of open. Another new high was set despite there was a 7-8 points pull back before closing. I tried several of bear call spreads in SPX and RUT but still no fill. I had a Dec 12, 2115 ES bear call filled in S-5. The 2015 is deeply ITM now. I have to exit it in the next couple days. RUT still couldn't get cross the Sept top. I will keep trying base on my rules of engagement patiently.

Grains continued to consolidate to the down side in small ranges. I tried to roll over some of my soybean from bear calls to bull puts for the first time. My assumption is that soybean may have set its season low of $9 on strong demand. Corn and wheat still hold up on weekly despite daily formation of HS. I closed my last Nov wheat position with a small profit. I still don't have a clear picture and plan for corn. After the roll over of soybeans I have a little more breath room for my margin.

Late Is Better Than Never 11-17-14

My plan:

I am late again on this Monday morning. I have had a habit of watching shows online at late night.

Futures dropped after Sunday's open possibly on Japan's growth contraction and China's bad loan numbers. ES breached last week's double bottom of 2027. I got up late this morning. ES already pushed back into last Friday's range since European session. ES closed the gap of overnight and ticked through O/N high. Bulls are still in control so far. RUT is also bull flagging on daily after pinched through Sept's high. I will try to sell bull put spread in SPX and RUT if we get futher weakness and looking at possible bear call spread if price come to good levels. But it looks like a choppy session around the last CHVA so far.

Grains pulled back overnight but nothing decisive so far. I need to focus on any contracts I have left for this month expiration.

My play:

ES/SPX pushed back to last Friday's range after open. Sellers made several attempt to push it out of the range but buyers responded swiftly. Buyers are still in control till the end. ES is not ready to go down yet based on today's action. It may have more upside before going down. The earning season provided a positive sentiment and this Friday is monthly option expiration day. I tried to sell RUT's credit spread and naked RUT of Karen's setup since RUT was down over 05% most of the day. I didn't get any fill. RUT closed near low of the day. I may have a chance to get a better fill if it continues to pull back in next couple of days.

Grains continued to consolidate. Corn recovered part of overnight loss. The weekly pole is still holding but today's export data showed weakness in corn sales. Soybean popped back to last Friday's range on strong export numbers. Both weekly and daily bars have shown strong rejection from upside. Wheat came back to retested last Friday's break out point. It held so far. I had two corn puts stop loss filled. Tried to roll couple of bear calls in wheat and soybean but no fill. I will try it more aggressively tomorrow.

I felt strong frustration building when I don't have any fills in indices. ES/SPX have been in small trading ranges for 5 days now.

Quote of the Day - Linda's Trading Rules

Linda Bradford Raschke produces six figure incomes from her trading, and has had years where she made half a million in income with few losing weeks. She is truly one of the top traders in the country. Here are her trading rules, many traders will find ones to add to their own method to help improve performance.

Linda Bradford Raschke – 50 Time Tested Classic Stock Trading Rules

1. Plan your trades. Trade your plan.
2. Keep records of your trading results.
3. Keep a positive attitude, no matter how much you lose.
4. Don’t take the market home.
5. Continually set higher trading goals.
6. Successful traders buy into bad news and sell into good news.
7. Successful traders are not afraid to buy high and sell low.
8. Successful traders have a well-scheduled planned time for studying the markets.
9. Successful traders isolate themselves from the opinions of others.
10. Continually strive for patience, perseverance, determination, and rational action.
11. Limit your losses – use stops!
12. Never cancel a stop loss order after you have placed it!
13. Place the stop at the time you make your trade.
14. Never get into the market because you are anxious because of waiting.
15. Avoid getting in or out of the market too often.
16. Losses make the trader studious – not profits. Take advantage of every loss to improve your knowledge of market action.
17. The most difficult task in speculation is not prediction but self-control. Successful trading is difficult and frustrating. You are the most important element in the equation for success.
18. Always discipline yourself by following a pre-determined set of rules.
19. Remember that a bear market will give back in one month what a bull market has taken three months to build.
20. Don’t ever allow a big winning trade to turn into a loser. Stop yourself out if the market moves against you 20% from your peak profit point.
21. You must have a program, you must know your program, and you must follow your program.
22. Expect and accept losses gracefully. Those who brood over losses always miss the next opportunity, which more than likely will be profitable.
23. Split your profits right down the middle and never risk more than 50% of them again in the market.
24. The key to successful trading is knowing yourself and your stress point.
25. The difference between winners and losers isn’t so much native ability as it is discipline exercised in avoiding mistakes.
26. In trading as in fencing there are the quick and the dead.
27. Speech may be silver but silence is golden. Traders with the golden touch do not talk about their success.
28. Dream big dreams and think tall. Very few people set goals too high. A man becomes what he thinks about all day long.
29. Accept failure as a step towards victory.
30. Have you taken a loss? Forget it quickly. Have you taken a profit? Forget it even quicker! Don’t let ego and greed inhibit clear thinking and hard work.
31. One cannot do anything about yesterday. When one door closes, another door opens. The greater opportunity always lies through the open door.
32. The deepest secret for the trader is to subordinate his will to the will of the market. The market is truth as it reflects all forces that bear upon it. As long as he recognizes this he is safe. When he ignores this, he is lost and doomed.
33. It’s much easier to put on a trade than to take it off.
34. If a market doesn't do what you think it should do, get out.
35. Beware of large positions that can control your emotions. Don’t be overly aggressive with the market. Treat it gently by allowing your equity to grow steadily rather than in bursts.
36. Never add to a losing position.
37. Beware of trying to pick tops or bottoms.
38. You must believe in yourself and your judgement if you expect to make a living at this game.
39. In a narrow market there is no sense in trying to anticipate what the next big movement is going to be – up or down.
40. A loss never bothers me after I take it. I forget it overnight. But being wrong and not taking the loss – that is what does the damage to the pocket book and to the soul.
41. Never volunteer advice and never brag of your winnings.
42. Of all speculative blunders, there are few greater than selling what shows a profit and keeping what shows a loss.
43. Standing aside is a position.
44. t is better to be more interested in the market’s reaction to new information than in the piece of news itself.
45. If you don’t know who you are, the markets are an expensive place to find out.
46. In the world of money, which is a world shaped by human behavior, nobody has the foggiest notion of what will happen in the future. Mark that word – Nobody! Thus the successful trader does not base moves on what supposedly will happen but reacts instead to what does happen.
47. Except in unusual circumstances, get in the habit of taking your profit too soon. Don’t torment yourself if a trade continues winning without you. Chances are it won’t continue long. If it does, console yourself by thinking of all the times when liquidating early reserved gains that you would have otherwise lost.
48. When the ship starts to sink, don’t pray – jump!
49. Lose your opinion – not your money.
50. Assimilate into your very bones a set of trading rules that works for you.

Weekly Review 11-15-14

This week I had only two  expired ES positions with a $600 loss. The loss was from my bear calls entered on reversal of the big sell off in Oct. The entry was not clear defined and well planed. I took the loss at 6X instead of my rule of 2-3X. Taking stop at the planed level is still my weakest spot. I have to be able to overcome the psychological barrier in order to stay in this business. Even pros admit  it's hard but not impossible to do. I didn't have any indices credit spread filled this week. Indices kept grinding up without any meaningful pull back. My patience has increased a great deal.

I continue to grains' direction wrong. Monday's USDA report didn't cause a sell off as I anticipated. Many of my put positions went underwater again as well as my bear calls. I had to take stops for my puts and roll up my bear calls. I need to reduce my grain exposures further for now. Stop these revenge trading. Accept my losses and wait for my time to come.

According to my last week's plan I initiated search for trading pals by looking at trading sites and posted a message in S-5 chat room. I wasn't very active and no results yet. I will step up my effort next week.

My plan for next week:

1. Continue to reduce my exposures in grains.
2. Clarify my rules of indices trading between my short term options and Karen's setup.
3. Overcome the psychological barriers of taking stops. strengthening my weakest link.
4. Continue to be patience and wait for market come to me instead of chasing it.  

A Mixed Friday 11-14-14

My plan:

I am late to write my plan again. I woke up at 7:30 and went back to bed falling sleep until 9:20.
ES held in the mid of yesterday's range between 2032-2038. It looks muted. After open ES breached overnight high for a point then got pushed back to overnight low. It likely to hold and skew up a little since buyers stepped in at overnight low and o/n high was broken earlier. I will try to sell bull put credit spread for a longer time out. and close a bull put of next week to release margin. RUT is below BB/M daily after yesterday's 1% drop. It may lead a pull back or next week.

Grains held in a small range overnight. After open, Dec wheat is challenging yesterday's high, Jan soybean dropped 15 points including o/n. Corn is holding yesterday's range and maintaining its up trend. I have to double check that all of my Dec's bear calls have a plan to be handled. My available margin is at low $30K and need to be increased.

My play:

ES/SPX had another small range choppy day. ES had only 8 points within yesterday's mid. Market is undecided in direction. I didn't have any fill here. I am patiently waiting for market come to me.

Grains are mixed. Wheat shoot up another 1.2% to 560. It made my Dec 560 in the money now. I will have to roll it next week. Corn dropped 1+% which let some of my failed puts stop out. It also release some pressure for my bear calls. Soybean fall hard in the last hour. It registered near 3% for all next 3 contract months. I added 3 of my bull puts back and rolled over a Jan 1080 bear call to Feb 1120. I still have several bear calls underwater. But it's a nice relief for now. Got to watch if it's a bigger force making a trend change. It closed right at the break out point after USDA report. Is it a retest or break down? It will tell by early next week. I need to hold up my entries until it's clear.

1st Pull Back 11-13-14

I missed writing my morning plan again. I woke up after 9 today. I guess that I haven't get into a habit of planing my day yet. It takes at least three week to change or form a habit. I need to be more consistent. A morning plan helps me to clear my head and develop a frame work for the day instead of shooting from hip.

ES popped up after Europe open overnight. This morning's US jobless claim report was 8K more than expected. ES tested overnight high, then got sold off all the way to yesterday's low which was my first support. It closed back to the mid of today's range. It basically formed a doji bar. ES had a range of 17 handles for the first time in four days. None of my credit spreads got filled. I am somewhat mixed up between my normal setup and Karen's. I need to further clear define my set ups. I sold one ES 1920 bull put for Dec 4 which I chased from 1910. I was frustrated when my original order of $380 for 1910 didn't get filled because I kept changing my entries. I ended up cancelling it and got a fill of 1920 before closing. I need to be more patient. There is always next day. Volatility should come back soon.

Grains continued their march despite of record high production and higher dollar. Corn and wheat had another 1%, 2% up day respectively. Soybean didn't go up much after a big range of yesterday. Tomorrow we will see what is the export data telling us.

Everything Marching On 11-12-14

My plan:

Indices futures fall 0.1-0.3% overnight pulling down by European markets. US market opened with some responsive buyers but the gap for ES/SPX have not been closed. ES has resistance at 2033, 2036 to 38, support at 2027 overnight low, 2022 and 2015 of a far reach. I will try to sell ES/SPX bull puts naked and spreads. The upward march continues and be patience.

Grains have been rallying overnight and after open. Wheat is leading with a 3% move, corn at 2% so far and soybean at 1% staying above last week's high of 1060. I don't know what is causing the rally, the pattern is similar to Oct's USDA report. I plan to exit and roll over my bear calls.

My play:

ES/SPX played the same pattern of early selling and later pop. My first support of 2027 was hit in the first hour. I had bull put spreads expecting of further p/b which didn't happen. Instead I rolled up my SPX and RUT bull puts to lock in some profit and collect some more premiums. I also rolled up my SPX 2070 bear calls to 2100 to avoid further loss and get into a higher position for a partial recovery. I will try again to roll up my RUT 1230. Rut cleared its Sept resistance of 1185 and ready to challenge 1200 next.

Grains surged this morning. Wheat had more than 3% upside, Soybean had over 40 handles range only to be sold back to 1050s. Corn held its up trend despite some selling. Most of my bear calls are further underwater now. The losses continue. I roll over a wheat and a soybean bear calls today. There are more to do if the uptrend continues. I also locked in profits for a soybean bull puts. I made another error of closing a bull put thinking it was a short put. I am still stressed.

Grains Disappointing 11-11-14

My plan:

ES popped up to 2039 overnight. It pulls back in attempt to close the gap before open. The 2050 target is only about 15 handles away. The bull is relentless. I will try to sell bear call spreads again on a new push up and bell put spreads if we get a pull back in ES/SPX and RUT. Overnight low is at 2032, 2nd support of CLVN at 2029.

Grains held up well overnight. Watch for today's price action to see how the market interprets the WASDE report. So far it looks neutral. We may get into a range bound period again.

My play:

It was another slow day for indices. My support level 1 for ES was hit and bounced. Not enough sellers to push it further. We didn't get a pull back I have hoped for. No orders got filled today. I also tried to roll up my SPX bull put from 1710 to 1850 in order to lock in the majority of profit. I will try it again tomorrow.

Grains popped today led by soy meal and soybean. Soybean broke last week's high and closed above 1060. There was no follow through on selling after yesterday's report. I should refer to seasonal charts more than 2009 charts now.  My bear calls of Jan 1060 is deeply underwater now. I made 2 key in errors in grains today. I guess I was distracted and frustrated. I really need to step back and reduce my activities in grains. It appears that the trend in grains is tilted up now.

Another WASDE Report 11-10-14

I totally forgot to write my daily plan on this Monday morning. I was out of routing?

Indices have had another day of upward consolidation or grind up. ES/SPX made another new high of closing of 2032 + 6 for ES. I tried to sell both calls and puts spreads but no fill since the range was very small. I can wait for another day. A pull back or pop up will come after a consolidation. I just need to be patient. I sold a Nov week 4 of ES 2075 in S-5.

The much anticipated USDA WASDE came out at 12 today. There was no any major surprises except a slightly lower corn production. estimate. Grain market didn't move much except soybean down about 12 point. Soy meal broke a chart low but pulled back at closing. Wheat is held at weekly low and it may have another leg down. Soybean and corn are still holding uptrend on weekly. I did get a soybean 1090 call of Jan and 370 corn puts. I may not get much profit out of these directional options if these chart patterns hold.

Weekly Review 11-8-14

Indices have relentlessly been pushing up this week. ES/SPX jumped over a major CHVN and left several gaps below. They closed at another new high of 2030ish this week. Oh, boy, I am glad that I took a stop loss of 2005 on Tuesday and avoid a big draw down. I still have a 2015 week 3 and 2070, a misuse of Karen's concept which are underwater to deal with. I will take stops or roll over these positions next week. I need to admit and correct a wrong trade much quicker instead of hold and hope it would work. A profitable wrong trade is still a wrong trade. The problem is it reinforce a bad habit.

Grains have traded in a range bound but each with its own tendency. Corn broken down on daily but still holding its weekly up trend short term. Soybean held up a daily bull flag on strong demand  despite large harvest data. Wheat resumed its down trend on daily and on edge of weekly break down. I am still being slapped left and right. Most of my Nov's puts have not been working out. I have been taking stops in wheat and corn. Majority of my bear calls are underwater. I took some profits in my bull puts this week. They may not be enough to offset my losses. Admittedly I really don't know enough about grain market to trade in such large numbers of contract. I have been fighting the trend and taking losses. I need to reduce my holdings, step back and let my mind to be cleared. I need to study seasonal charts, current trend and have a plan for Monday this weekend. After USDA's report on Monday I will start to reduce my holdings and wait for market to tell me the direction.  

Review of last week's plan:

I didn't initiate any action to look for a trading partner. I will do it this coming week.
I had one entry mistake in soybean bear call which hasn't be exited yet.
I did study seasonal for grains.
I didn't watch three webinars but attend one with Stage 5. I will watch two trading video next week.

NFP 11-7-14

My plan:

Indices drifted higher overnight. US NFP came out at 8:30 at 214 v.s. 235 expected. There wasn't a strong reaction to either side. ES is moving back to yesterday's high before open. It's not likely we will see a big new high drive nor a big drop. Will we see the same pattern of last few days? I will sell bull puts and credit spread on any meaningful pull back. Also try to roll up my bear calls.

Grains stayed in prior day's range except wheat down 5 point. Trades expected to re-position today before USDA report on Monday. I will try to buy a call and put for soybean to hedge. I have directional options in corn and wheat already.

The play:

ES/SPX had a small range (11 points) with the same pattern of sell early and push up later. It couldn't retest the new high made after NFP report before open. Today's closing was pushed back to yesterday's high. It's a Doji again. There was no sell off even with a below expectation NFP report. We may see some pull back next week? I didn't have any trade in indices.

Grains held well before the USDA report. Maybe don't expect a very bearish report? Demand for soybean and corn have been strong. Cash prices are improving according to Grain TV. My corn put/call positions are balanced for now. There are more bear calls in wheat but my March 550, 540 bull puts are deeply underwater. My soybean is underwater in bear calls. I tried to rollover but no fill for last couple days. I will review my position and develop a plan for USDA Report over the weekend.

Quote of the Day: Be patient, life will offer you another chance as soon as you find calm within, for abundance is born out of calmness. @The GodLight

The Break Out 11-6-14

My plan:

ECB's announcement popped market pre-open. ES touched the high of 2026. NQ had different behaves yesterday and this morning. It closed at lower part of profile yesterday and didn't break prior day's high thi/s morning either. FT is expecting a range day within yesterday. I will sell bull puts and spread on any meaningful pull back and roll up my bear calls on break up.

Grains had another strong export report which helped to hold yesterday's range. I will limit my activities in current positions and manage my risk.

I read an article about high performance traders by Dr. Steenbarger. There are couple of very good points:
1. These high achieving traders spent more time prepare, study, analyse market and trading strategies than actually trading.
2. They have had good mentors and ended up developing their own trading approach and styles.

Indices broken out as expected after ECB announcement before market opened. Sellers stepped in after open and pushed ES to 2010 with the same pattern of the last few days: Sell first and ramp it up later. ES/SPX closed at all time high again. I had a ES bear call of 2060 for next week filled at $210. I may try another one tomorrow with credit spreads. Indices have more room for upside depending on how trades interpret unemployment data tomorrow morning.

Grains pushed up but failed to hold their gains at closing. Export data is still strong. I bought two Dec corn 380 calls to hedge my puts just in case Monday's report turning out like last month. I may try a call in soybean tomorrow. I roll over half of my soybean 940 from Jan to Mar to lock in some profit and just in case a big drop after USDA report on Monday.

New High Again 11-5-14

My plan

Indices futures went up over night on Mid Term Election results. They parked right at yesterday's before open. I will manage my bear call positions, exit or roll up on the raising market. If we get a sell off after new high I will sell bull puts in all three acct.

Grains continued to the downside overnight on the harvesting news and US dollar is at 4 yr high.
I should focus on managing bear call positions, buy puts for the down turn. Don't over trade bull puts. There are more room to go down.

The play:

As expected indices made a new high. Sellers tried to push it down after new high was printed early in the session. ES had overnight gap closed and then buyers stepped in. It was a choppy session until closing at top. The energy for break out is building. The last piece is tomorrow's ECB announcement. It may well be causing the market to break up or down depending on what ECB brings. I had one RUT bull put for Dec filled today. SPX and other credit spreads were missed. I should be patience to wait for a pull back. I don't want to enter any bear calls until there is clear break out and clear rejection.

Grains dropped and bounced later in the session. Arlan commented on support levels but I didn't see them. I need a better TA procedure as my routine. Fib and BB in daily and weekly as a starter. I traded some bear calls and bought couple puts in corn. I am still doing it as it goes. No clear plan and responsive rather than proactive. I need to slow down and look at the bigger pictures.

I made another key in error in soybean today. I entered 1130 bear call instead 1150. it got filled on market. I placed an order waiting to get out.

Taking Stops 11-4-14

My plan:

ES skewed slightly lower overnight after making a new high intra-day yesterday. There is a gap below 2002 to 1989. I don't know if the market can close it today though. I must close my 2005 bear call today before the election result. Mid term election has a positive seasonality back to 50s according to FT.

Grains dropped overnight as well. It's not quit confirmed the return of down trend yet. I will continued to manage my risk and lock in profit.

The play:

ES/SPX broke overnight low after open and crossed last Friday's low before lunch. I thought it was going to close the gap of last Thursday and Friday. I had several bull puts and spreads placed but none was filled. Buyers stepped in before it even touched last Thursday's high. I suspect it left some room for the next push down and bulls didn't want the price get into balance area below. I took the planed stop of 2003 on today's pull back. It was the punishment to me for not obey my stopping rule of 2-3X. I paid 7X of loss today. I must break this psychological pain point of taking stops at smaller losses.

Grains dropped again today. Corn and soybean looked firmly broken on daily. Wheat is still holding on the trend line. Most of my Dec puts exited on stop losses. I am still waiting for the next shoe to drop. I bought couple more puts for this month and next month for next week's USDA report and next leg down on huge crop numbers. I will try on soybean tomorrow. It's hard to tell what wheat's next move. I will need to study its seasonal chart further.

Waiting for Election? 11-03-14

ES had a very tight range overnight. It's very likely to see a new high break out today at least during the RTH. It may be too early to sell calls since I don't see a sign of topping and don't know how high it will go. It may be prudent to sell puts on any pull back. Define and manage risk first. Tomorrow's mid term election could be a big mover no matter which party wins. May be I should wait until then to trade.

Grains have been slightly down on Sunday night. Read several comments expecting a beginning of resuming down trend. I will not believe it until I see a break of some kind to confirm it. Meanwhile manage my risky positions.

EOD:

Indices held well in a small range for most of today. They pulled back to last Friday's range in the last hour. My guess is that trade was waiting for tomorrow's mid term election results. It's often bullish to the market according to people who are familiar with its seasonal. I will take stop of my ES 2005 bear call in S-5 tomorrow on an expected pull back to prevent it further going ITM. I may sell couple credit spreads and naked bear calls on p/b. I didn't have any fill today.

Grains pulled back somewhat today. Only wheat bounced back and closed with a 5C gain. Couple of my stop loss in puts got filled. I still have more bear calls in wheat and soybean, corn need to get out.

Overall, it was a light day. I was calm and clear.

Weekly Review 10-31-14

It was a small profitable week ($1.4K) on weekly expiration only. Had near $8K recover in Oct.

Indices completed a V shape recovery in weekly chart the past week. ES/SPX closed near all time high set in mid Sept and ready to break new high. I will watch to see if we get a repeat of selling on new high or This is the beginning of year end rally.

Grains held up well on strong demand, especially in soy meal and delayed harvesting pace in corn and soybean. I studied grains charts of 2009 which was a big harvesting year similar to this year. Most lows on the 2nd push down were set in Dec and Jan. I need to update my seasonal charts to compare 5 and 15 yr historical tendencies. I continued to take losses on near by contracts since I missed my chance to take profits for my puts. I was able to lock in some profits for these far out dated contracts. I will wait for the next push down to reload them. I still have some far out dated bear calls underwater and I have been debating weather I should take my losses now or wait for the next down turn. According to my rules I must take stops and leg up or wait out. I will execute according to my trading plan next week. My delay of action has costed me more losses.

My actions of the week:

1. No key in errors. Avoided such simple mistakes by read through and double check my order entries.

2. Study and review Karen, the Super Trader's principles and setups. I entered a SPX  naked bear call for later Dec which violated her rule of 1STD, 2 weeks out for bear calls. This position had 2 STD and 60 days out which is underwater now although I had a bull put for the same expiration date. It made the trade to an Iron Condor. Her principles of trading far out of money and time is similar to the Options Selling book I read and makes more sense to me now.

3. No clear picture and strategy in grains. I was like a dear looking at headlights. I was confused between experts' comments and price actions. The plan I can think of now is to step back and let things become clear to me again.

4. Reduce trading in grains. Grains tend to have much longer trend. I shouldn't trade it on a daily bases. What I need to do is: A. identify the trend; B. compare the trend with seasonality; C. Form a plan of action; D. Wait for the price come to my level before take any trade.

Plan for next week:

1. Incorporate the lessons I have learned into my thinking process and trading, such as Karen's rules of engagement, Stop acting on impulse, like closing my eyes and jump.

2. Take stops of these rule broken positions on any pull back.

3. Try to think my trading is a pure number and strategy game. The first rule of the game is to reduce risk and big loss.

4. Continue to learn. Watch and read more trading related contents. Watch at least 3 webinars.