A Big Thanksgiving Shock 11-26-21

 The Thanksgiving week started with SPX hitting another ATH 4744 but got rejected the same day. The following two days retesting the 20D SMA were held. The RUT was a different story. My note of the divergence from last week continued. It all changed on Thanksgiving night as the new virus strings were reported from South Africa. The US futures were down more than 1% across the board. The Friday's open was all in the hell falling. The volatility and fear were high during the shortened trading day. RUT is back into the 2295-2240 pre breakout range. SPX failed 4620 support area. The bull flag is broken. Is this the last pullback before the Christmas rally as the seasonal pattern or the 10% retracement like 2018 that missing from this year? I guess it all depends on how the new virus develops in the next few days or weeks. As VIX popped 50% and above 25 now, be prepared for a further drop as the worst-case scenario.  

The IB Net Liq closed at 144,764, down 25K from last week's 170K. The realized P/L is -$9,258. The premiums collection is only $760. I had an SPX 4690 assignment for $700 on Monday's bearish engulfing. The leverage is above 3.1 for the first time since early October. This is a drawdown I was anticipating and afraid of. Mr. Market often throws a curveball. My personal accounts were hit hard too. My Etrade account realized a loss of $8770. I was assigned 3 SPX 4700 puts on Monday for a loss of $4974. I tried to make it back by selling an IF 1 DTE for $2,880 premiums on Tuesday. I rolled the call side to 4705 for -$320. Thinking I would be able to recover about $2,500. Then, I sold 4670 put spread to raise 5 points for the 4705C. I thought I was going to recover from the assignment with a couple more of such trades. The sudden drop of last night put me into a further loss of $6686. I had to roll the 4670 to Dec 16 4620P with a 320X spread. My plan is to give it some time for me to make adjustments in both calls and put sides. 

My major mistakes are Monday's assignments which I could have stopped out early or bought protections for the 4700 puts. I should have entered the 4670P stops last night since SPX is trading overnight now. A small actual stop is easier to recover than a full loss rolling. 

My task for next week is to reduce the distances of my put spreads, mainly is to reduce risk and margin requirement. I must obey my rules of sizing. I broke it today with a RUT put spread for Monday. I will close it to correct it on Monday morning. 

The Indices Divergent 11-19-21

 The majors are diverging this week. DOW and RUT, the large-cap and small-cap closed down more than 1% for the week while NQ is up more than 1%. SPX is slightly up with an almost Doji candle. Are we going to see a 2018 Nov style selloff since we have not had a 10% pullback this year?  If not a pullback is most likely in next Jan-Feb based on seasonality. 

My IB Net Liq is up to 180K before I send another 10K back to ET. This is the highest level since Nov 2016. It's the five years of struggle and recovery. Keeping the size small and staying with the direction of the market are the keys. The leverage is at 239. The premiums collected are only $1650, plus $2100 from my directional trades for the week. The realized profit is 3644 from the options selling. For the personal accounts, the realized profit is $1555, mostly from the 0 DTE trades. 

Luckily, my directional trades worked well this week. The NVDA, TSLA, and MRNA paid off well over 300%. I also made repeat mistakes on order entries. I accidentally release a QQQ order meant to be looked at in the IBP account this morning. I didn't obey my rule of following my subconscious. When in doubt don't do it until my mind is clear. I did follow my rule of -1+1 and watch for deltas. 

Watch for the indices divergent next week. The Thanksgiving week could be slow. Safeguard my profit of the year. When in doubt, don't do it. 

The Bulls Pause With Seasonality 11-12-21

 All the majors closed slightly down for the week which is in the seasonal pattern. If the seasonality plays out then we may see another small down leg before the year-end rally. The Fed's tapering decision didn't even put a dent on the market. The 6% inflation jump only dragged the market down for one day. So the bulls are still running. 

IB netliq closed at 166,980, up almost 9K from last week. The leverage is 233, near the low of the year. The realized P/L is $5023, about 1K better than last week, partially due to there being no rolling of any ITM bear call. The collected premiums are only $900. The personal accounts performed steadily.  The realized P/L is $2100 after taking a $400 loss in AMD directional trades. I start feeling better trading TOS now. 

The options selling worked fine for this week. I stayed with the rule of -1+1. I stayed small with my trading sizes. The directional options didn't perform well. The TSLA rolling from a full profit last week was a mistake. Musk announced selling 10% of his own share dragged the stock down. I didn't protect my profit quick enough. Let all of the gains slip away. I was trading AMD reactively without a clear plan. It didn't have a clear direction and I was trading both sides trying to escape the chops. I ended up getting chopped on both sides. I must set clear levels for my entry and exit for my directional plays. 

Small Caps Break Out ATH 11-5-21

 It was another up week for all indices. Small caps finally broke out their range from Feb, an almost 10-month consolidation. SPX hit new highs every day this week. Dow and NQ made ATHs as well. The Fed tapering announcement seems no effect on the market sentiment. I can't follow the logic of the current market other than better earnings and the fourth quarter effect. But I will follow the direction of the market and stay with my discipline.  

IB netliq closed at 158K, about 3K higher than last week. The leverage is 257, slightly better than last week's 262. The realized P/L is $4141 with $3109 cash collected. So it's a positive week with the trend up. I didn't actively trade my small accounts in the 0 DTE, had difficulty getting fill bull puts.  I only collected $662 for the week, plus $115 from TQQQ. My directional options did well with the strong uptrend. Booked $1000 from TSLA call spread, and several hundred from FB, NVDA. My first MES 45+ DTE hit its 50% target in 10 days.  

I still have emotional issues in my trading decisions, especially with the directional trades. The two major issues are fear of losing and false hopes for a losing position. I need to be more mechanical in entry and exit.  My patience has improved some, mainly I could recognize my impatience and I would look for something else to distract my anxiety. Keep working on it!