Apr 18 – Rocket to resistance, S&P 1393. It hurts

I am getting slapped around a bit on this gap up.

I am disappointed in myself. I let a full allocation ride into earnings and have been beaten. I had been dodging bullets during earnings. JPM, KO. I had a feeling that HON’s expectations were low going in, but I didn’t take my risk off for a 5% loss, rather it looks like I will take a much larger loss. My accts are stressed today. Down as much as 6.5%, bummer.
“Don’t hold a full allocation going into earnings”. Just silly.
And as thought the SNY trade is turning ugly too. Not a lot of good right now.
MRVL – Sold final unit of 12.5c for .27. Small consolation, but I am grateful.
HON – My god I was murdered in these today. I am so disappointed in myself. I could have exited half prior to earnings. Then again when I was wrong, I could have exited on this mornings pull back. Unfortunately I did neither. And I sold the Apr/Jun 55c spread for .60. And .80 loss @ 60.90. I will write more on this later.
I sit here just screwed. the acct is down 6% on the day. Incredible. I have blown through long hedges. IWM, and unfortunately put on more short exposure during the week XLE, IWM. Ouch. And my long exposured trades this week have been crap. UST, CALM. Damn.
TXN – added 8 units of May/Jul 30p between .50 and .46. A two month Calendar for .50 to .46. Breakevens of 28 and 32.40. this offers a 1.5:1 reward to risk in the front month. Earnings are on Monday. Did I not learn my lesson? We will see. I did put on a half allocation rather than a full. Vol Skew in my favor. 31.7 vs 26.8.
SNY – Sold 37.5p calendars for .50 this was a mistake yesterday, as the calls were priced much better than the puts. I don’t want to be making more dumb moves. I made too many poor moves yesterday.
For what it’s worth I just rebalanced my 401K. I was 90% invested in Stocks from S&P 1315. I have decreased my stock exposure to 40% and have the rest in Total Return/High Yield funds/Cash. If we get a continuation rally early next week we could see S&P 1430. But it doesn’t look like more than that in the short term.I will still be able to benefit from some upside, but there is still too much risk in the equities market to not pull some of the 8% gain off the table.
These are some of the trades I have positions in: DTV earnings on May 7th. The vol skew of my calendar spread is 7% in my favor.
UST – reversion to mean? It is quite the channeling stock.
XLE – here was a mistake of mine. I followed an advisory service recommendation. Oops. It was a bearish call hoping that the XLE has run too far too fast. Obviously I believed it, even though it broke through upside resistance. Now by May expiration might this be back between the breakevens. Sure it could, but the chart is in clean air to the upside. Not one of my best entries. I haven’t been defending my capital properly, and I am paying a price for it. My bad.
When all was said and done, it was painful. My largest loss while trading for myself 4%. I have 65% cash, but that is less cash than I started out the day with. I will be diligent in my efforts to recoup that next week. My 3rd down week in 18 months. Off 2.1% on the week. The worst part is that I started off the week bullish.

One thought on “Apr 18 – Rocket to resistance, S&P 1393. It hurts”

  1. man, i’m joining you in this pain. probably not the best time for a beginner to start trading. these are some tough markets!
    it will be interesting to see how this rally reacts to the resistance we’re at right now. i’m gonna wait and see before trying anything new.

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