2014/08/29 UNG - Natural Gas Midterm Setup with Fibonacci Targets & Squeeze Support

UNG setup

Long Trade Setup for UNG (Natural Gas ETF) with Fibonacci Support/Resistance Clusters and midterm targets from the daily Chart:

- solid Fibonacci support cluster at 21

- seasonally expecting move up until the end of the year

- geo-political situation might help 

- the daily Squeeze just fired long yesterday, so we expect an average of 8-10 bars of daily push power

- breakout to a new swing high yesterday indicates that a new long trend could be established
- Fibonacci-target 1: 23
- Fibonacci-target 2 (and hurdle on the way up): 23.4-23.7

My Trade Strategy is to sell an at-the-money Put Credit Spread :  Sell GTC Jan15 +21/-23 ATM PCS at $1.10 or better (currently $1.13).

The idea is to have an "edge" from the analysis and to implement the trade with a neutral 1:1 risk/reward, after having paid commissions. If the spread is sold at $1.10, the max risk will be $0.90 + commissions.

If UNG expires in January above $23 you'll make +100% profit, if it expires below $21 your take the full loss of -100% (this works like a risk-balanced binary option, that's why I call it 100binOpts). In effect, you need only a $1 move up to make full profit on the trade. If you end up somewhere in between the $21-23 range you'll experience a partial profit or loss. Of course, partial profits/losses can also be taken at any time earlier than Jan 15.

2014/08/26 TSLA Squeeze Setup with Fibonacci Targets

TSLA setup

Long Trade Setup with Fibonacci Support/Resistance Clusters and midterm and longterm targets from the daily and weekly Charts:

- the weekly Squeeze has already fired long and a few more bars of push momentum in reserve
- the 4 hour Squeeze is getting ready fire long (with overnight data it already fired long)
- Fibonacci-support-cluster at 253-250
- Fibonacci-targets on the daily chart: 271.4 and 276.9
- Fibonacci-targets on the weekly chart: 288.9 and 319.3

2014/08/09 FSLR Squeeze Setup with Fibonacci Clusters

FSLR setup

Long Trade Setup with Fibonacci Support/Resistance Clusters and Squeeze push engine:

- above all EMAs 21/50/200 (supercalifragilistic setup)
- great push up from EMA 200 after earnings on good volume
- daily squeeze triggered long (2 bars) - weekly squeeze in place
- Fibonacci-support-cluster 60-55
- Fibonacci-target 80
- Fibonacci-hurdle 70

The first move up has taken FSLR up to the Fib-hurdle around 70. A pullback in the 65 zone would be nice and for me a preferred entry zone. If FSLR manages to get through the 70 zone, the move has a high probability to get to 80.

My Trade Strategy is to sell an at-the-money Put Credit Spread (my GTC limit order being already in the market):  Sell Sep14 62.5/67.5 ATM PCS at $2.55 GTC (currently $2.03)

=> if the FSLR expires above $67.5 you make +100% profit, if it expires below $62.5 your take the full loss of -100% (works like a binary option); if you end up in between the $62.5 - $67.5 zone you experience partial profit/loss

Should FSLR pull back to 65 my spread would be filled automatically at $2.55, which is a tiny bit more than 1/2 the spread (the extra 5 cents is to cover commissions). The basic idea is to risk $2.5 to make $2.5.  You will also make full profit if the stock moves up only slightly, no huge rally move needed :) 

Note: This is just a trading example for educational purpose only and should not be taken as trading advice. Trading Options carries substantial risk. An ATM credit spread generally risks the full width of the spread minus the credit received. This means that you need to employ your own risk and money management strategies.