A Wild Quarter Ending Friday 3-31-17

Window dressing continued to the last day of the quarter. Indexes briefly dipped after open. Buyers pushed it up, especially for RUT. It gained more than 0.5% for most of the afternoon. Sellers only emerged 15 min before closing. I had hard time to roll my RUT 1360 ITM call until the last hour of the trading day.

Made 10 trades today. Rolled out 2 ITM RUT calls for me and a client. One was near out of the money at beginning of the week. But RUT turned up pretty strong for the last four days.

Net liq lost 2.2K, recovered from 6.5K earlier when RUT was up 0.5%. The pull back in the last 15 min before closing helped to reduce a big part of damage. Margin ratio is around 50% for the weekend. I just have to deal with it one week at time.

Testing Break Down Points 3-30-17

Market continued to move up as the final GDP P/P was 0.1% better than expected despite that unemployment claims were 14K more than expected. Market continued to advance with window dressing for the first quarter.  RUT and SPX closed up 0.75 and 0.29% respectively. It may be a little more volatile as the month and quarter end.

Made 6 trades. Sold couple May CS bear call spots for clients. I made couple RR in RUT to hedge my call side and closed 2 put positions. I need to roll 2 ITM RUT calls tomorrow. Also continue to hedge calls for next 1-2 weeks.

Net liq suffered 7.4K, the largest for this week so far. Margin ratio is back above safe levels for now. I am getting frustrated for not been able to collect premiums on such move up period. I have to continue to defend my ITM bear calls with this up trending market.

Holding Up 3-29-17

Market advanced another small step. It held up well today without any notable selling pressure. SPX and RUT are close to their range tops and daily trend lines. I will watch to see if the resistant areas hold. I need to apply more patience. With the quarter end near we may see more buying and window dressing in next two days.

Made 8 trades today. Had 2 risk reversal in SPY and IWM and 1 bull put ratio hedge in my account. Sold 4 RUT May 2 and 3 call spreads for clients. I don't want to add any more of bear calls until I reduced my current holdings in RUT. We don't know if this is another leg to new highs.

Net liq suffered another 4.6K on a smaller raise than yesterday. Initial margin was also reduced. I haven't figured out the math behind it yet. I will continue to hedge for next week. I am incurring lost time and opportunities while dealing with the oversize bear calls.

Follow Up 3-28-17

Market followed through yesterday's reversal. RUT and SPX both closed up 0.7% area. They are firmly back into their ranges now. We may see the indexes to test their upper ranges before end of this week. It may range bound for awhile to build energies before break out one way or another. Keep in mind that it's still an up trend. The test below are completed for now.

Made 9 trades today. Other than 3 exit fills I hedged with IWM and SPY. Sold couple of SPX May 2 CC for clients. I don't have much room to short calls now. I am not eager to add more short calls at this level. Let the market push up to the edges of current range. It's OK if I miss it to the upside.

Net liq gave back 3.4K. Margin ratio is above 30%. I have next 3 days to add call hedges. I will try to split and exit one more RUT bear calls before end of next week.

Monday Reversal 3-27-17

Futures gaped down on Sunday night. It was down more than 1% for ES and TF by mid night. Market opened with the down move overnight. I was expecting the selling pressure to stay for a day at least. But buyers stepped in in later morning session. At end of the day RUT recovered all of its losses and closed +0.2%, above its Friday closing. SPX all most fully recovered as well, down only 0.10%. It was an impressive turn around. Both SPX and RUT held bottoms of their ranges. However weekly MACD started to cross down from above. Bears are likely to defend the current range highs. We may see a tog war or range bound for a while. As the month end and quarter end nearing we may see more buying activities for window dressing and buy any dip players.

Made 7 trades today. Most of them were hedges on both side, other than sold an IC 2 of April 5 for $430 in ET. Margin is back to call side again. I will have to buy more RUT hedges for next week since I only got calls for this week.

Net liq increased 3.5K although RUT closed in green. Most of it maybe come from the bull puts. My portfolio is out of immediate danger for now unless a +-2% sudden more in the market. I will use this break to learn more hedging techniques.

No Vote On Healthcare 3-24-17

Market traded in range while awaiting for Congress to vote on the healthcare bill for most of the day. It was quite emotional news driven day but no break out one way or another. Indexes went into red in mid afternoon as the vote appeared unlikely. Then it recovered back to green when no vote was confirmed. All of the struggles for nothing. I would assume that market will re-access the failure of the bill and start again on Monday.

Made 5 trades today. I was able to exit both RUT 1360 call and 1340 put at minimum prices. The ideal situation I described last night. It is an exception of most situations I have had. I used SPY and IWM to hedge my put side due to the small range and wider spreads of they big brothers. No premiums collected today.

Net liq stayed flat. Predicted margin is adequate for next Monday. I will try to exit or raise my RUT 1360 call next week.

Waiting For Congress To Vote On Healthcare Act 3-23-17

Market continued to recover some losses from 2 days ago. Today's price actions were very much influenced by news of the Healthcare Act from Congress. The prices moved up and down as the talk of deal on and off. RUT closed up 0.57% giving back almost half of its HOD and SPX closed -0.10% due to the delay of vote on the healthcare act. Apparently the ultra conservatives want to strip more benefits off of the bill.

Made 1 trade in correcting of the erroneous order I made yesterday. I took off the long puts and short calls. I left out the bull puts and bought a put to hedge it. This mistake cost me $160 so far. If that 4-7 132 bull put expires worthless then the whole pack will end with a small profit. If not I will book a loss. It reduced some risk for now. None of my hedge orders got filled today. It will be a busy day tomorrow. I have to hedge both side and deal with the RUT near TM 1360 call and 1340 put. One of them may have to be rolled or closed unless RUT close near 1350 area. It's a tricky satiation. I placed orders for ideal exit on both positions. I will take actions by 2pm unless it's a big trending day tomorrow.

Net liq gave back 3.7K at 157K now. I may have 3% cushion left  above. Margin is at put side right now. Available funds are low, but predicted excess is fair for next Monday. I will see things may change tomorrow and act accordingly. Futures are up 0.5-0.3% so far tonight. It's all news driven now.

A Breather 3-22-17

Market took a breather today after the sell off yesterday. SPX and RUT both closed near flat recovered from earlier losses. Both of them parked at lower end of their balance area and b bands. Market may be awaiting for Congress to vote on the new healthcare bill either tonight or tomorrow. We may see a bounce or retest low from here on technical.

Made 3 trades with one erroneous order. I forgot to cancel an IWM put rollover order after I placed another order with a different date. I didn't act quick and decisive enough to correct it. I will make it tomorrow. I will take a loss if market pop up tomorrow since the order is long put and short calls. I also made a risky split of RUT ATM 1350 bear call into 2 1360 bear calls in most recent two week strikes. My intention was to reduce one position within two weeks and raise the strike up 10 points. But I currently have added one position hope it will expire OTM within 2 days. Then my next week's position gained 10 points with a better chance to exit. Both of them are only 15 points away from current price so it's 50/50 chance right now. I placed an order to close this week's 1360 for $60 to b/e this trade. In this case I didn't lose anything but will gain 10 points.

Net liq added 2.7 K. Margin ratio dropped below 30% on put side due to the added put in the split trade mentioned above. The position will be off by this weekend one way or another. I will continue to add hedges on both sides and make naked rollover if I can tomorrow.

A Follow Through Break Down 3-21-17

Futures popped early last night following a small down day for no apparent reason. Market started pushing up right off gate. I thought it would be a turn around Tuesday to the upside. It turned out that I was wrong again. It turned out to be a decisive break down. First I thought RUT would have had a 1% down day, then 1.5% by lunch. 2% was the max to me. It ended closing at 2.7% down. SPX closed down -1.2%, the 1st time in about 5 month. Market can do anything for no apparent reason.

Made 20 trades today. Many of them were filled in the first 2 hours of market open. Turned out to be too early. Especially the hedges.above RUT 1300 puts. I noticed many of my orders were influenced by my fear of missing instead of measuring market levels. Since it has been so long without a volatile market I kept use my recent experience of buyers stepped in on any minor pull backs. I need to have a more detailed daily process and 2-3 scenarios for each day, Like Trader71's hypo 1-3. Despite of the shortcomings I did maintain my calmness and held back on placing orders after lunch time. I didn't go in with full force to sell puts.

It was a big relief for my portfolio. Net liq is up 23K. Margin ratio is back to safe level. Leverage is below 100, the first time since the election. I was able to pay another 5K back to ET. Now it's time to pay attention to the risk of my long puts.

Testing Water Monday 3-20-17

Indexes tested lower following the dip overnight. RUT and SPX closed -0.55% and 0.22% respectively. Both are closed on top of their prior ranges. Bulls are still alive and well unless we see follow through sale pressures. MACDs on daily are showing divergences between RUT and SPX. RUT is turning up while SPX is crossing down. Generally RUT is leading so I would lean toward to upside.

Made 8 trades across board. Made couple of roll ups and used risk reversal to add a small hedge in IWM. I made a mistake bought a naked put instead of selling it in a client's acct. I had to flip it and made a small loss on closing it. VIX stayed low despite of the down day. None of my put credit orders got filled except a large spread in ET to make of IC2.

Net liq upped 8K on RUT 0.55% drop. These rollover helped to reduce the impact of price of fluctuation. But it's still not enough to get me out of water. I may try rollover in different size and strikes. I need to get 1-2 short calls of my back.

Market Paused After A Big Run 3-16-17

Market took a pause today and closed within +-0.3% between SPX and RUT. VIX continued to losing ground despite that SPX was in negative territory most of the day. MACDs of SPX and RUT daily started crossing up. Next circle up is underway. RUT pushed into its balance area above but couldn't close within. It's likely to try again tomorrow. SPX may break new high in next couple sessions unless the last line of resistance hold.

Made 13 trades today. I had to close out my last IMT SPY 223C to void a possible assignment before Exit Dividend Day tomorrow. It was a $1.6K booked loss. I plan to put it back at higher strike to recover some or all of the loss. I still feel anxiety when I try to take a loss. I placed a market order last night without knowing how it works overnight. I only remember my prior assignments were filled around 3 AM. When I saw it didn't get assigned this morning I rushed to place my exit order right after open. Emotion without control is the enemy of trading. I also bought two gold miner ETF based on my reading in Wchat. I want to start practice some small directional trading. The rest of trades were mainly hedging and a SPX put spread.

Net liq suffered another 2.6k on a 0.2% RUT gain. Margin is slightly on put side now. It appears OK for this week's expiration. I will continue to change my current hedge to buying hedges with collected premiums.

Rate Hike Boosted Market 3-15-17

As often the case bull market takes any news as good new or ignore any bad news v.s the other way around during bear market. Market reacted positively with Fed's rate hike without any attempts of sell off. RUT and SPX closed up 1.5, 0.83 % respectively. SPX is heading toward a new high above 2400. RUT closed at 1383, the top of its current balance area.  It will need a little more work to get through its next balance area unless it gaps up overnight. My hypotheses of a break out played out but I still don't have a good strategy to follow the trend except the SPY long calls helped to hedge my delta.

Made 8 trades today. Sold for bear call spreads of April to make IC 2s for clients as I don't have much room to add bear calls. Three of my RUT put exit orders were filled. It reduced my exposure fees but switched margin to call side. Since the market was up so much none of my long calls were filled. I only have next two days to get my margin hedged again.

Net liq lost 15K which wiped out most of my gains of the past week. The shallow pull back may be over. I need to prepare and think of new ways to deal with the next up swing. Risk reversal, ratio hedge or calendar strategy?

Crude Oil Dragging 3-14-17

Indexes gave back their gains from yesterday with continued falling crude oil prices. SPX and RUT closed down 3.4 and 5.6% respectively recovered a half of their earlier losses. Overall the market is very resilient consider that crude has dropped near 10% dragging energy sector down. RUT is firmly back into its prior balance area while SPX is still holding its lower part of current balance area. A narrow B band may be building a base for another leg up of SPX.

Made 14 trades today. Rolled over all ITM expiring calls thanks to the pull back today. Left some premiums on the table due to overslept this morning. I also rolled some SPY, IWM and RUT calls to lock in profits and raise strikes. I had to use more ratio hedges to add defensive puts. Had to use one Risk Reversal to buy 2 calls for next week which increased the exposure fees and put margins to the put side. I don't want to use this tactic unless no other choices. I prefer to use the put position to collect some premiums on rollovers and use part of the collection to fund my hedges.

Neg liq goes up and down with indices due to these ITM positions. Margins are the same way. Margin ratio is back to 53% for now. All the waiting for FED will be end by tomorrow afternoon. Market appears no fear so far. It refuse to go down then it is likely to go up. They are waiting for tax cut and infrastructure spending proposals.

Awaiting For FOMC 3-13-17

Indices had a choppy flat day on this Monday, two days before FOMC announcement. A rate hike is expected by the market. There is no clear indication of the sentiment. Trades may be more interested to read the languages of Fed announcement. It's likely there is another pop once market put the rate hike behind it and waiting for more economic policies.

Made 2 trades on this slow day. Closed 2 hedged puts and one naked put in RUT for a client. I tried to sell some call spreads on RUT and put spreads on SPX due to the two were on opposite directions during the day. It wasn't a disciplined action on such low price movement and two days before FOMC. I still have the bad habit of looking for trades and taking chances. I listened to Mark Douglas and Jesse Livemore's audio books over the weekend while fixing the garage ceiling. I realized that lack of patience and discipline is still my weakness. I need to continue to work on change these habits.

Net liq lost 4.1K with 0.4% RUT gain. Margin ratio was up some after the expiration. I get to work on hedging next week. I plan to roll up my ITM positions more aggressively from tomorrow.

A Blow Out Job Report, A Muted Market 3-10-17

NFP report was 235K vs 196K expected. It was a blow out report but market reaction was limited. SPX and RUT moved up less than 0.5% and were pushed into negative territory for awhile in mid day.  Finally both SPX and RUT romp up during the late session and closed into positive territory similar to yesterday. Market is preparing for next week's FOMC. I don't know which direction will react to fed decision. I read a statics that market react to Fed rate hike positively above 70% of time during the last twenty years.

Made 5 trades today. It was a boring day without vols. No premiums were collected. I bought a RUT call for hedge and closed a put to reduce margin and fees. No any other orders were filled. Closed couple of positions for clients. That was it.

Net liq stayed about the same. Paid another 5K back to ET. I may need it again if we get another surge on FOMC. Margin ratio is low but will be back up after this week's expiration since it's on put side. I just have to pay Excess Fees over the weekend. This week had some rollover and lock in some profit and raised strike price up. I will try to reduce RUT 1350 and roll couple other positions up.

Back Into Previous Balance Areas 3-9-17

It appeared to be a recovery day for the indexes in the morning session. Price actions showed some strength. Then, sellers hit the market in early afternoon. RUT and SPX went into negative territory with 0.6-0.4% ranges. Buyers stepped in during the last hour closed SPX up +0.1%. RUT lost 0.44% but TF  recovered more after cash closing. It was a two ways market today. Better than one way market before. Trades were positioning for tomorrow's NFP report. Market believes it would influence Fed's rate decision next week.

Made 8 trades today. Some of my bull put CS orders for late April were filled for my clients. I also rolled up two more ITM bear calls. I didn't get much hedging on the put side. Margin is still on put side. I expect some put positions get closed tomorrow. I will raise price to exit couple put for next week if nothing gets filled until early afternoon.

Net liq recovered a little more. I have gained up 40-50 points with this week's rollover and locked in $5-6K profit. Margin ratio dropped below 30% due to the lack of put side hedging. I will work on it tomorrow.

Where Are The Bulls? 3-7-17

Indices came down a little further to my surprise. Bulls tried to take back the lost ground before noon but were only able to fill the open before noon. I thought the usual pattern of run up in afternoon would play out but it didn't happen. Sellers pushed RUT to the low of day at closing. RUT and SPX ended down 0.69% and 0.3% respectively. The ranges were not big but the persistence of sellers was impressive. SPX closed the Trump speech gap today and set on top of prior range. RUT fall into the upper part of its prior balance area. The up trend is not broken but the retreat is a welcome relief for my portfolio. Be aware that bulls can show up any time to buy on dips. VIX and RVNX were falling with indexes today again. It shows that no fear in the market yet.

Made 7 trades across all accounts. Only one rollover order got filled since VIX was still falling with indices. No bull put orders were filled at all. Made couple hedges on both sides. Margin is on puts at end of the day. I will try to buy more calls to if we get more weakness tomorrow.

Net liq gained another 8.2K. I transferred 5K back to ET to cover its negative balance. Margin ratio is back to 50% for now. I will try to bring the post expiry back for next week.

A Little Weakness On Bull Resting 3-6-17

Market followed Friday's down ticks with a small gap down today. Both SPX and RUT recovered some losses in the afternoon as buyers stepped in when the indexes near their range lows. SPX closed last week's gap below and bounced from there. RUT retested its prior range high for the third time and still holding. Is this going to be a lunch pad again or are they going to fall back to VPOC before Fed meeting by mid of this month? Listened to Mark Douglas's Trading Psychology audio book in Chinese over the weekend while installing laminate floor in Northlake. It made me think more about my trading practices. I have more work to do to my trading mindset and system. I will study more and summarize my learning.

Made 6 trades today. Most of them were to lock in profit and roll up my positions while the market was down. I decided to roll my positions more aggressively and further out on calendar date. I will use more naked puts to help roll over ITM positions. Then spend part of the premiums collected (20-50%?) to buy hedges.  I was able to use some SPY gains on call side to fund that deep ITM position.

Net liq gained another 8K while I raised 20 points up in RUT ITM positions. Until I can exit some positions in these ITM calls my net liq is vulnerable on any up surges. Margin ratio is lowered due to expired hedges. I will buy more hedges tomorrow.

Hard To Expect Unexpected Without Flexibility 3-2-17

I was expecting a follow through after the high closing of yesterday. SPX and RUT didn't even retest yesterday's high and started dripping lower. I thought the pattern of lower morning up in the afternoon would play out. RUT didn't have a hourly green bar today and closed down 1.3% while SPX gave back 0.6%. Both closed at lower side of the day but still been an inside day. There is no structure broken so far. What's weird is that VIX and RVX both were down with the indexes. They are supposedly to go opposite directions. It shows that market has no fear. This unusual situation will resolve soon. My hypotheses for tomorrow:
1. Retest yesterday's low and bounce to hold current range;
2. Gap down to get back into prior balance area;
3. Attempt new high from European market overnight. SPX is still hold its island while RUT is back into the gap zone.

Made 14 trades today. Rolled SPX 2400 bear call spread for Lao Dong and rolled up a RUT ITM call to lock in a small profit for me. the rest of them were hedges and exit. I brought post expiry excess back to 62K from -23K. I closed 2 ITM IWM 136 right after open based on my plan to reduce margin and improve net liq. The timing was wrong but it was a right action. I will recover the $900 loss eventually. Save myself to continue my fight.

Net liq recovered 18K along with margin ratio. My priority is still to figure out a better way to bring my ITM positions out faster.



  

Another Blow Up 3-1-17

Market got another shot after Trump's Congress address. Without giving specific policies market keeps expectation high. A big gap up this morning took indexes to a one way street. SPX closed up 1.35%, setting up a new range around 2400. RUT reversed the down turn of yesterday and booked 1.9% with new high above 1410. It had a 3+% gain counting from yesterday's closing. It's possible that it will get into a new range.

Made 7 trades. Rolled a threaten SPX 2390 for a client with more to deal with for around 2400 positions. I could do much hedging with the one way street price action. I rolled SPY 236 ITM calls to 3/16 240 1:2 to get more hedges. Glad I sold some puts yesterday. Too bad there was no follow through to the down side. I may have to start to book losses to reduce my margin. I wired another 10K in. Don't have much funds available to keep plugging the whole. I have to think what to do if the market goes up another 3-5%

Net liq suffered a big blow, losing 26K. What the difference a day made. Margin ratio and available funds are in danger for next week. I have to buy more hedges before end of Friday. I will prepare another wire transfer of 15K as my last effort to shore off Net liq. Then will have to book losses.

Unexpected RUT Pull Back 2-28-17

As I was planning to wire additional 10K fund to shore off net liq by noon RUT opened lower. It couldn't close the gap above during the 1st hour of trading. The pattern of early drop and late pop didn't play out today. It closed down 1.5% for the 1st time in weeks. Although it's still inside its balance area any sign of weakness is a help for me. The other major indexes didn't drop much today. RUT tends to lead the market. Hope it's the same case this time. I will see what how the market react to Mr. Trump's speech tonight. So far the futures markets only up 0.3%. There was still no clear tax plan been laid out. We may see 1-2 days of pull back.

Made 22 trades today. I was actively hedging both sides and rolling my ITM calls to take advantage of this pull back.  The rolled up calls will reduce my net liq requirement dollar by dollar until I can take them out one by one. Margin is switched to put side now. Sold some late March and April puts across accounts.

Net liq got a 20K relief today. Margin ratio and available funds recovered for now. The prediction is a short fall of 9K excess funds after this week's expiration. I will fix it in next couple of days. The pull back today is a much needed relief.