June 2008 Archives

The last call trade worked out great (sarcasm.) I sold my open contracts to get what I could on this nice little up move this morning. I had 40 contracts of the QQQQ Jun 50 calls (which expire next week.) I had a cost basis of $0.60 and sold them this morning for $0.12. That was an 84% loss on this trade.

The recent $50 highs on the Q's now look like a resistance point and will probably be seeing some more downage from here. The trendlines just rolled over and now the weekly trend is now pointing down. So once again the go away in May adage seems to be holding true this year.

Next week I will be on vacation for about 10 days and I really need a break from the office. I will also take a break from my trading as well and will get back into it after my vacation.

The Q's look like they have found some near term support at the $49.55 level today and my indicators just turned positive for a buy signal. So I just went long the Q's for a swing trade back up to above $50.

I bought 40 contracts of the Jun 50 Calls on the QQQQ (QQQFX) with a cost basis of $0.75. My stop will be the lows of the day today at $49.55.

The Q's went straight down to $49.91 (one penny shy of my $49.90 target) and bounced right off that point this morning. This looks like a nice gap down reversal so I sold my contracts for a nice profit of 16%. In theory I could have done a true reversal and sold my puts and opened some calls, but right now I think that may be too aggressive. We could test $49.90 again or head to to S2 at $49.38 today. If we do happen to do that, I may think about getting long with some calls at that time.

So for recap I was in 40 contracts of the Jun 50 QQQQ puts at a cost basis of $0.73 and I sold them this morning for $0.85. This represents a 16% gain on this trade.

The Jobs report came out this morning and the futures market didn't like what is saw. They moved from being in positive territory to a sharp decline in futures prices.

S&P 500 (JUN) -6.50  | Nasdaq (JUN) -9.75  | Dow (JUN) -47 

NQ seems to have shown some support at the 2042 level and are now starting to use that as a base to trade a little higher off these lows.

The pivots for the Q's today are as follows. Pre-market the Q's are sitting right on the pivot number and I would love to see them test S1 sometime today. I still think we will have some support at the $49.90 level and will probably take my profits on my Jun 50 puts if we get that low.

R2	R1	Pivot	S1	S2
51.20	50.88	50.29	49.97	49.38

I decided to not take the stop once the Q's hit the $50.50 level. They got as high as $50.61 on the day and are starting to retrace a bit now. For my current play on the puts I think we will re-test the $49.90 level again over the next couple of days. I do expect that it should hold and we head higher from there. I expect that we should see some downwards movement to digest the strong gains we have had the last couple of days and this is the short term trade I'm playing now. I'm resetting my stop to $0.60 on the Jun 50 put contracts (which would be a 20% loss.)

The one thing is that the Q's are acting strong right now and the other indexes are not participating as much. If we get some participation from the Dow and S&P then we could see $55 on the Q's fairly quickly.

I'm testing the waters here and buying some puts on the Q's. My signals just flashed an overbought and there seems to be a reluctance for the Q's to crack above the $50.50 level.

So I purchased 40 contracts of the Jun 50 puts on the QQQQ (QQQRX) with a cost basis of $0.73. If the Q's break above the $50.50 level I will take that as a stop.

There is no reason to be greedy. So I decided to take profits here on a trade that was meant to be a swing and turned into a day trade that lasted less than 3 hours.

The Pivots for the Q's today were as follows:

R2	R1	Pivot	S1	S2
50.39	49.90	49.43	48.94	48.47

So I decided to take profits on this trade since we are seeing some resistance at the $49.90 level.

For recap I was in Jun 50 QQQQ calls at a cost basis of $0.50 and out at $0.86 which was a 72% gain on this trade.

The Q's are starting to look good for another ride up from here. We are hitting the bottom of the short term trading channel and I'm getting in to take the ride back up to the $50's on the Q's.

I just bought 40 contracts of the QQQQ Jun 50 Calls (QQQFX) at a cost basis of $0.50.

The Q's rocketed down this morning on the ISM and construction news. They blew through S1 and S2 and I decided to sell for a profit at this point so I can stop watching the markets. I have tons of work to do in the office right now and this was setup to be a quick swing trade. The Q's may still have some downside all the way down to the $49 level. But I don't have the time to watch it from here.

So for a recap, I was in the QQQQ Jun $49 puts with a cost basis of $0.50 and I sold at $0.79. This represents a 58% gain on a trade that lasted about 2 market hours.

Both the ISM and construction spending reports are due to hit the markets at 10AM this morning. The futures are telling us they are expecting some negative numbers today since the futures are currently trading down.

S&P 500 (JUN) -6.25  | Nasdaq (JUN) -6.25  | Dow (JUN) -55

Any positive news from these two reports could drive this market higher. I currently hold puts on the Q's and I'm already in positive territory. I will be keeping an eye on the markets when these reports are released to see if I need to take action on my open positions.

The Q pivots for today are as follows:

R2	R1	Pivot	S1	S2
50.49	50.25	50.00	49.76	49.51

I suspect we will open up and test S1 on the open today and I expect we may also visit S2 sometime today if the reports at 10AM are as expected or worse than expected.