6/26 – Volatile! and I like it.

The VIX is at 17+, TRINs are breaking out. Excellent. Opportunity. I like it.
I am using this time to look at some directional plays and use Butterflies to take advantage of this “VOL”.


The VIX is at 17+, TRINs are breaking out. Excellent. Opportunity. I like it.
I am using this time to look at some directional plays and use Butterflies to take advantage of this “VOL”.
I have some June Quarterly Butterflies that will benefit on strong down moves. We could get one today!
A trade I like, and just put on a level is CLF (cleveland cliffs). There is some risk here, but when I get a BUY Signal I am looking at the environment. I like this one. I put on 1 unit, @ .99. Oct 90c/100/110 butterfly. I wanted to get the first level on. I am banking on some support at the 50 MA (75.55), I will buy this butterfly into the 50 MA, but not beyond it. I will check up on it daily, but I should not need to do too much maintenance. There is a 10:1 Reward to Risk on this 20 point wide butterfly.
CLF%20Chart.gif
BTU – has gotten hammered. I have exited the Sept 45p-40 vertical for a nice profit. The hedge worked well. I still have a Aug 55c/60/65 Butterfly. With the profit from the Put Vertical, effectively now have the Butterfly on for free. And the position as a whole has made a profit. If we continue to see a sell off, I will look to exit my short options (Aug 60). This will just leave the calls basically as Lottery tickets. Nice.
BIDU has held up well during this sell off. It seems to be taking a que from GOOG. Time decay is in my favor on this one.
CREE spreads are moving out. Good.
USB – 35p Jul/Aug Calendar. The underlying is down slightly. The spread has tightened, around even. I am trying to put on another level for even.
BUD – underlying down sharply. Spread is in good shape.
COGN – I exited the remainder of the trade today. It was a very nice trade. Bought for .15 about 3 weeks ago. Today I sold the last unit for .45. I believe the underlying may rise to the 40 strike, which would be max profit. However, with only 1 unit left in the trade, I decided to conserve mental capital and take the trade off for 175% gain. I am please with the outcome of this trade.
STLD – I only have a 1/2 unit remaining on this trade. Fortunately, the chart showed the story, and I decided to exit the other 3 1/2 units for a 60% gain. It was a short-term (2 week trade). I will sell the remainder of the position if we have a relief rally.
AMTD – it is parked at 20. It is ideal. I only have 1 unit on. I sold my other unit for a 100% profit a week ago. I am holding on to this last unit until volatility changes something, or near expiration.. There is still a 2:1 Reward to risk on this trade.

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