Can You Follow Me Here? I’m $$$$$$
October 1, 2008
I wanted to go over the trade recommendations Ive made since I started this blog and advise you on the current open positions we are holding. I will use an example of trading 1 unit which would require around 10k in the account.
First the bad news , one Gold futures trade that lost around $900. The option trades on the DOW JONES INDUSTRIAL AVERAGES options positions would have seen the following results. On the first NOVEMBER set of option trades we sold a 11500 call for $3500 and bought the 11800 call for $1500 which resulted in a credit of $2000, with that $2000 we bought the 11300 November DOW puts and 3 days later we closed out the 11500 call for $400 which resulted in a PROFIT of $1600. We also closed out the 11300 November Dow puts for $10000 for a profit of $8000. The next move was after I called the bottom in my post” dont be short here” we stayed with the 11800 call so after the rally back up we resold the November 11500 Dow Jones Call again for $2000 and re-bought the 11300 November Dow Jones put option for $2500. This left us short the market again. Then in my post “cautiously bullish” we closed out the 11500 Dow call for $500 this was a profit of of $2000 and we sold the 10500 put for $6000. So our open positions are this….. We own the 11300 November Dow Jones puts for $2500 and sold the 10500 November Dow Jones puts for $6000 this leaves us a credit of $3500 and the potential for another $8000. This is called a BEAR PUT DEBIT SPREAD although due to my impecable timing we end up with a credit instead of a debit. We also still own the November 11800 Call option straight out. So at this point we are still cautiously BULLISH based on our postions with a net profit in the bank of $14500, our open postions value is around $5000 so our total account value at this time would be our original $10000 plus $14500 plus our open position value of around $5000, bringing our account up to $28500 including our Gold Futures loss.. minus fees. Not bad for 2 weeks worth of trading . Where do we go from here? Im going to stay with the positons I have and continue to look for this market to rally back up for this week, on a hard dip to around 11000 or under I will come out with a new recommendation to sell the 11300 November puts we own and roll them down to the 10600 November Dow puts but lets wait til we see what happens til then over all i would say we are in fine shape and hold the course . I like the dollar short here tonite and I would be looking to start buying the Auzzie dollar and sell the Jap Yen against it on the futures . I think the commodities have seen enough of a correction for now and the Auzzie dollar is a commodity based currency . The Jap Yen should weaken against the other currencies due to low rates and slow economy there. If you dont understand any of this or need clarification please comment or contact me so I can explain it to you. Good Trades All and Happy New Year to all the Jewish people out there:)…