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. 

2014/07/08 DAX hindsight Squeeze trading

DAX - FDAX

While I am not a fan of hindsight trading posts, I thought it might be of value for some of you to have a look at four DAX Squeeze setups in the 30 min time frame that have fired in the last six days. For each one of those setups the Squeeze_Momentum and MACD(13,55,8) correctly indicated the direction in which the Squeeze would fire, i.e. grey arrows pointing three times upwards and yesterday downwards. In all four cases a nice dynamic movement followed the Squeeze phase, good for long options traders (and others too ;) ) It's a nice set of indicators that has worked well for me - independently of the time frame used. 

Obwohl ich kein grosser Fan davon bin, Charts im nachhinein auf ihre Profitabilität zu checken, dachte ich, es könnte nicht schaden mal einen Blick auf vier DAX Squeeze-Setups im 30 min Zeitrahmen zu werfen, die in letzten sechs Tagen losgefeuert haben. Für jedes der Setups wurde vom Squeeze_Momentum und MACD (13,55,8) korrekt angezeigt, in welche Richtung das Squeeze losfeuern würde (siehe graue Pfeile dreimal nach oben und gestern nach unten). In allen vier Fällen folgte eine schöne dynamische Bewegung nach der Squeeze-Phase, ideal für long-Options Trades (und natürlich auch für alle anderen Trades;)) Dieses Indikatoren-Set liefert mir verlässlich gute setups, völlig unabhängig von der Zeiteinheit des verwendeten Charts. 

Aunque no soy un fan de analisar un chart retrospectivamente, pensé que podría ser de valor para algunos de ustedes echar un vistazo a cuatro setups Squeeze del DAX en el marco de tiempo de 30 minutos que han disparado en los últimos seis días. Para cada una de esas setups el Squeeze_Momentum y MACD (13,55,8) indicaron correctamente la dirección en la cual el Squeeze dispararía, es decir, flechas grises que señalan tres veces hacia arriba y una vez hacia abajo ayer. En los cuatro casos, un buen movimiento dinámico siguió a la fase de Squeeze, bueno para negocios de opciones "long" (y otros negocios también ;)) Es un buen conjunto de indicadores que ha funcionado bien para mí -  independendente del período de tiempo utilizado.

Für alle die mehr wissen wollen, hier nochmal das Video zum Squeeze Indikator

2014/07/04 Muenchner Rueckversicherungs AG - daily Squeeze & Fibonacci Targets

Muenchner Rueckversicherungs AG

Muenchner Rueckversicherungs AG has a lot of push power from Squeezes in the weekly/daily charts. It just broke above the important 163.5 resistance level with more upside potential. 

Fibonacci support and resistance levels:

Target 1 (30min - 161.8%): 165

Target 2 (daily - 100%): 170

Target 3 (daily - 127.2%): 175

Support Clusters(daily): 

Support 1: 159-156.8

Support 2: 151.8 - 150..9

Support 3: 147.6 - 145.8

2014/07/02 DAX daily and 30min Squeezes with Fibonacci targets

DAX - FDAX

DAX daily/30 min Squeezes and upside Fibonacci Cluster resistance:

The DAX is building up Squeeze push power in the daily and 30 min charts. Should the Squeezes fire long, would the next Fibonacci Cluster targets be at 10134 and 10330.

2014/06/17 DAX Fibonacci Clusters for the 4h and 30min charts

DAX - FDAX

DAX Support and Resistance Fibonacci Clusters:

 after the Squeeze breakout there might be more more upside potential if a pull-back holds at the 9900 - 9867 Cluster

2014/06/16 DAX Fibonacci Clusters for the 4h and 30min charts

DAX - FDAX

DAX Support and Resistance: Fibonacci Clusters for the 4h and 30min charts

2014/05/23 BIDU & NDX setup update: daily squeeze fired long while weekly squeeze is building thrust power

Short update for the NDX and the BIDU weekly-daily squeeze setup of May 19, 2014:

Driven by the Nasdaq breakout on Friday, the daily squeezes of both, BIDU and the NDX have fired long. In this move, BIDU has already reached a first target, the 127.2% Fib-extension at $167.05, which now adds to the overhead resistance of the April 25 swing high at $167.36. A small retracement on Tuesday possibly with an additional squeeze in the 30 min chart would be nice to find a good entry point for the long side.

What makes this setup so attractive is that there is lots of "squeeze-fuel" left in the trade, with a 7-9 bars expected move off the daily chart, and a weekly squeeze that hasn't even fired yet. A good time to turn on the squeeze thruster ...

BIDU

NDX

2014/05/19 BIDU with nice weekly daily and 30min squeeze setup

The chart says it all: BIDU's showing a nice weekly and daily squeeze setup, and just triggered an additional 30min squeeze long. I am watching the markets at the moment. Should the general direction be up today, BIDU has the potential to be great long candidate, also for the longer run. 

2014/05/15 SPX Calendar - Double Calendar adjustment

Adjustment to SPX Income Calendar, Thursday May 15, 2014: 

Convert SPX Calendar into a Double Calendar

As already indicated in the original post of May 13, an extension of the SPX Calendar into a Double Calendar would be used adjust the trade, should the market move outside of the 2/3-adjustment points under the tent. This happened in a strong sell off on Thursday, May 15, so that an additional SPX JUL/JUN14 1850 Calendar Spread was added, with  35/63 days to go until expiration:

BOT +1 CALENDAR SPX 100 JUL 14/JUN 14 1850 CALL @10.05 CBOE

Volatility was up at 13.64% at the time of the purchase and the IV percentile was at 23% (compare with 10% for the initial tent). Consequently, the cost per contract had increased to $1005 for the second tent, as compared to $955 for the initial tent. As shown in the P/L chart below, the Double Calendar spread is now nicely centered and Theta has doubled, so that time decay can do its work. The SPX Chart below shows horizontal red lines to indicate the new break-even zone of the Double Calendar from 1830 to 1915. Fibonacci clusters are also shown with support levels at 1860/1845/1825 and a target cluster at 1920. 

Profit target / stop loss: generally my stop loss matches the minimum profit target, which is 1/3 of the Calendar max profit value. In this case the tent initially had a height of $1420, so my stop was set around $400-$500 and my profit target in the same range. Note that these values stay the same after adding the second tent to the trade, i.e. after converting the Calender into a Double Calendar. Because you add more risk with the second Calender, your risk/reward value will worsen. However, at the same time you have bought (through the added risk) a higher probability trade, because now you have a wider range to be profitable. A higher probability trade does not mean that you will earn more, but that there is a higher chance you will meet your profit target. Good so !

Updates for this and other trades can be found at the InOutOptions page 

2014/05/12 SPX Calendar - new monthly income trade

New income trade Wednesday May 12, 2014 (opened two hours before the close): 

Bought a SPX JUL/JUN14 1900 monthly Calendar Spread with 38/66 days to go until expiration 

BOT +1 CALENDAR SPX 100 JUL 14/JUN 14 1900 CALL @9.55 CBOE

The trade idea:
The decison for the SPX at 1900 is either UP or DOWN. Volatility is extremely low at the moment at about 12% and SPX IV-percentile is in the lowest 10%. For me a good opportunity to open the first "tent" of a double Calendar, at a value that might see some back and forth trading (up to 1920, down to 1850, see chart)

However, should Ms. Market decide to make a stronger move - either up- or downwards - then a second Calendar tent will be placed according to market action either above or below, receptively. The current trade therefore carries only 1/2 of the total capital I am willing to risk in this trade. Lets Ms. Market play her game, we are prepared with a plan for all three directions. 

Updates for this and other trades can be found at http://inoutsignal.blogspot.de/p/inoutoptions2.html