May 2008 Archives

I just bought some puts for what I think/hope will be a quick swing trade. I'm thinking I will be out on Monday or Tuesday of next week. The Q's are showing an overbought condition and I think we will head down to retest the $49.00 level again before we head back up.

So I bought 40 contracts of the QQQQ Jun 49 puts (QQQRW) with a cost basis of $0.50.

I think we will eventually head up to the $55.00 level on the Q's, I'm just trading this quick move to the downside.

I was out and about most of the day today in meetings. I ended up selling my calls right before the start of a meeting at 3:00 today to get out with a small gain.

So for recap I had 40 contracts of the Jun 50 calls at a cost of $0.81 and I sold at $0.88 for a small 10% gain in 10 days.

My position has retraced back from the low of a 50% loss to a 10% gain in the last couple of days. The Q's are now telling me we are at an overbought condition and we maybe heading lower again. So I took what I could from the trade. I may look to go short tomorrow.

The Q's have already traded over 1 million shares in pre-market trading and is currently up 15 cents. The upside move from here looks good and the volume this morning is a good sign that we will be heading higher for the next couple of trading days.

The futures this morning are also strong.

S&P 500 (JUN) +3.75  | Nasdaq (JUN) +8.25  | Dow (JUN) +23 

I'm still holding my calls on the Jun 50's and I should get close to break even on my position near the open. Hopefully they will continue higher into profit territory before they get too over bought.

Update at 9AM: The Q's have now traded over 5 million shares pre-market and are now up 30 cents. We have seen this type of pre-market volume for a couple of months.

The markets took another tumble yesterday and the price of Oil continues to cause worry in the markets. I'm again on the wrong side of that move. I'm still holding my calls (which are down about 40% now) because my charts are telling me we are heading higher. I still have several weeks of life left in my June calls, so I'm not too worried. We are still in the longer term uptrend channel and are now just testing the lower end of that channel. I'm already 30% invested and if I had more money I would buy more at this level. However, I don't want to get too over committed if I'm drastically wrong in reading the charts.

Pre-market the futures are pointing to a lower or flat open. The Q's are currently trading flat pre-market on some decent volume of over 2 million shares.

S&P 500 (JUN) -1.00  | Nasdaq (JUN) -4.25  | Dow (JUN) +1 

The pivots to look for on the Q's today are shown below.

R2	R1	Pivot	S1	S2
50.18	49.18	48.60	47.60	47.02

Update at 9AM: Oil just turned around on the futures and is heading lower. The futures are improving for NQ and it just went green. The Q's are now up a quarter percent in pre-market trading.

Oil is now trading above $130 and the markets took a nice dip over the last couple of days. Yesterday I bought some calls on the Q's near the close since several of my indicators flashed a short term trend bottom. I went in heavier than normal (almost 30% of the portfolio), so I will keep a close eye on this trade to make sure to limit any losses.

Pre-market the futures are looking to open weaker this morning. The Q's are trading down about 9 cents.

S&P 500 (JUN) -4.25  | Nasdaq (JUN) -8.75  | Dow (JUN) -32 

A quick look at some of the pre-market movers is SMH (semiconductor ETF) is up almost 2% pre-market, MSFT is up half a percent. So there looks like there is some strength in the tech sector that should help to get these Q's moving up in the right direction.

My signals just flashed an upside move and I bought Q's at the close of the market today. The pullback over the last couple of days was much needed to continue the upside push. The last half hour of trading was strong on the Q's and I decided to go long.

So I'm in 40 contracts of the Jun 50 Calls (QQQFX) at a cost basis of $0.80.

I have to run to a meeting and I figured I would book my profits now on the downside move that happened on the Q's this afternoon. No sense in letting them evaporate while I'm away from the computer.

So I was in the Jun 50 puts on the Q's with 20 contracts at $1.10 and I just sold them at $1.31 for a profit of 19% in a couple of hours.

I just entered an order to get back into some puts on the Q's. I think we are at a short term overbought condition and I would like to trade this for a quick hit to retest the lows of Friday.

So with that I just bought 20 contracts of the Jun 50 puts on the Q's (QQQRX) at an entry price of $1.10.

The Q's hit the $50 mark yesterday and they look to open up above $50 this morning on the open. Pre-market the futures are also pointing to a higher open.

S&P 500 (JUN) +2.75  | Nasdaq (JUN) +1.50  | Dow (JUN) +16 

I'm currently still sitting on the sidelines and I'm looking to see which way I want to swing this. I have been mentioning that I thought the Q's would hit the $50 level sometime in the middle of May. Well that event has come to pass and I think we will see some strong resistance at the 52 week highs of $55.00. 

Right now the Q's are overbought and my tendency is to look for some puts. However, there is some strong buying pressure now, so it is just wait and see time for me right now.

It looks like I'm on the wrong side of my swing trading again. I'm out of sync with the market and I need to wait for better opportunities that are clearer for any future trades.

I closed out my puts for a loss as the Q's are heading higher to reach the $50 level. Yesterday the Q's crossed the $49.20 level and quickly ran up to $49.35 and I almost sold. They then started to decline after that point and I decided to stick with the trade. Well this morning the Q's gapped up and are now trading above $49.50 as they head higher.

I was in 20 contracts of QQQQ Jun 48 Puts at $0.95 and I sold at $0.78. The represents a loss of more than 17% on this trade.

There was very light trading volume yesterday in the Q's and pre-market it looks to be light as well. The Q's are currently down a quarter of a percent in pre-market trading, but there is no conviction on this move since the volume is just not there.

The futures are currently point down as well.

S&P 500 (JUN) -4.25  | Nasdaq (JUN) -3.50  | Dow (JUN) -29 

I currently have puts on the Q's and I hope to close them either today or tomorrow with some gains. I still see potential upside on the Q's and this trade is just a counter trend trade as we re-test support in the $48 level.

My indicators are telling me the Q's are near the top and we should see some downside the next couple of days. We have had a strong day today to the upside but the $49.20 mark seems to be showing some resistance. So I just went short for a trade for retest of support at $48.

I bought 20 contracts of the QQQQ June 48 Puts at $0.95. My stop on this trade is if we break above the $49.20 level on the Q's.

I sold my calls this morning for a loss. We had some strength this morning and I may have gotten some more money back, but the market is looking week again. So I took back what I could from this trade.

For recap I was in 80 contracts of the QQQQ May 50 Calls at $0.26 and sold at $0.09 for a loss of 65%. I still think we will see some upside to the Q's this week, but I think there is just not enough time left in these May contracts to recover any additional gains.

My next move will probably be to the downside with some puts later this week.

I have been a busy boy the last couple of days and it looks like my workload will be busy for sometime. With that the posting has declined and also my decision making on my portfolio.

You would think I would learn not to have an open position on when I'm not able to watch it. Well my current call options on the Q's are down more than 80%. That should teach me an nice lesson. My daytrade is now working into a swing trade that I will be lucky to get out at break even. I have some time today to watch and see if I can get some money back on this trade. But with options expiration next week, the chances are slim unless we get a big move sometime today. If these were June options I would have more time to get back to even or profitable.

As they say.... "stupid don't get paid."

I just added another 40 contracts on the pre-march weakness I thought may happen. So I now have 80 contracts of the May 50 with a cost basis of $0.26. Now the market can fly if it wants to.

I'm taking another stab at a quick long call option on the Q's. I may make this one a day trade since we are now getting close to being over bought. The good thing is when the market is getting juice you can stay overbought for a long time.

So I'm in 40 contracts of the May 50 Calls (QQQEX) at a price of $0.28. I may add more if we get a little bit of weakness before the noon hour. I expect that we should see a big move to the upside in the last couple of hours of trading today and I want to take advantage of that move.

The markets had a nice turnaround on the day, my second buy of contracts for my Q's were very close to the low of the day and the Q's have had a nice 1% rally since that point.

The trade is now looking like it has entered into some short term over bought conditions so I have decided to sell out here and capture my profits.

I was in 50 contracts of the May $49 calls (QQQQEW) at a cost basis of $0.45. I just sold them at $0.60 for a gain of 33% in less than a day. They got as high as $0.65 but it looks like that was the high and they started to head down mid-day. It never hurts to take a profit early while you still have them.

I just added 30 contracts to my May $49 calls on the Q's. I now have 50 contracts at a cost basis of $0.45. This represents almost 19% of my portfolio (I know because I just added a column to my tracking spreadsheet on how much any trade is for the portfolio.)

The Q's have had a nice move down this morning and they seem to have found support at this level. They are still showing an oversold condition and I think they are heading higher over the next couple of days.

It looks like I got into my long position early again. The futures this morning are currently down and news reports are stating this is caused by poor a loss reported by Fannie Mae. FNM is currently trading down over 9% in pre-market.

The futures are currently at:

S&P 500 (JUN) -7.00  | Nasdaq (JUN) -8.25  | Dow (JUN) -54 

The Q's are currently trading down almost half a percent and I may pick up some additional contracts after the market opens. The Q's are currently showing an oversold reading and I still feel we are heading higher from here over the next couple of days.

We completed our office move this weekend and everything seems to have settled down at the office. I'm currently looking at my chart of the Q's and it looks like it is time to get long the market for the short term. We had a nice consolidation day and my short term indicator just turned positive.

So I just bought 20 contracts of the May $49 calls (QQQEW) at a price of $0.53.


p.s. Happy Cinco de Mayo!

Today is May 1st and I figured I would document the performance of my trading. I should do this on a monthly or at a minimum on a quarterly basis so I can document my performance in this trading journal. I currently track all of my trades via a Google Docs spreadsheet. I love Google Docs, it works great when you need information from any location in the world and allows me to track my trades from work, home, or anywhere I can get a net connection.

I started the year with my Qswings portfolio at $10,000 and as of May 1st the portfolio is now at $11,860. So I have gained about 18% in five months. I have made 29 trades and 16 of them were profitable. I was burned by the first couple of losing trades by being too heavily invested (over 25-40% of the portfolio in a single trade.) I have since tried to limit each trade to 10% of the portfolio on average so any loosing trade doesn't impact the total portfolio as much.

My goal for this portfolio is to double on a yearly basis. It is a lofty goal and I'm falling behind a bit currently. However, I'm not complaining to much since I'm still doing well and in the green.

Yesterday the Fed made a cut to the Federal Funds rate by 25 basis points. This brings the rate down to 2%. As usual the statement from the Fed was long winded and the markets took some time to try and decide what to do. So at 2:15 the markets rocketed up and down with some wild swings that are always fun to watch. Finally they decided to take them down for the session.




The futures are currently trading up at the moment but we are almost 2 hours from open this morning. So things may change in that time. The Q's are currently trading up slightly in light pre-market volume.

S&P 500 (JUN) +3.00  | Nasdaq (JUN) +3.75  | Dow (JUN) +31