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SherriT
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I think you went way too far down....that would be a really risky put. You might make really going money on it, but if it doesn't get below 38, you get nothing.

I think the QQQQs will be down below 40 by June, so I have (in real trading) purchased a few June 44 Puts, 43 Puts, and 42 Puts. The 44 will make the most money if it gets lower....but I also paid the most for it.

Chart's advice was to look for the extremes, then on the 5 minute chart, peg the top (or bottom) and buy - you can save yourself a lot of money that way.

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Study before you buy, Sell before you think about it....

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milliam
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Even if you're buying 38 strike puts, it doesn't have to get below 38 to make money. As long as the stock moves down towards your strike price before too much time runs out, you will still make money. Basically, people will be buying the option on speculation that it will reach that, or they'll be buying to close that option that they sold.

If you went out real far (both time and strike price wise) and picked a contract selling at $.05 per share, its very possible for you to double that money quickly...if the market moves in your direction, fast enough and far enough. It doesn't ever have to get to your strike price, as long as you have time value. If you only have a month or so left and you're still way out of the money, then you'll be likely to expire worthless.

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Jenna
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Ok guys thanks so much for explaining it....

so basically, it is the safest to buy near the current price & place a call or pull, then to go farther out-of-the-money, but the farther you go the more you can make but more than likely it will wind up expiring worthless....

Correct?

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..just remember....Family is EVERYTHING!!

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SherriT
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Thanks Milliam - I wasn't thinking about that aspect of it (being able to day trade it, etc if it were close.)

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Study before you buy, Sell before you think about it....

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SherriT
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QQQQ is FINALLY starting to fall today....I hated seeing that one go up!!!

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Study before you buy, Sell before you think about it....

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Jenna
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I know Sher- I wish my order was real....

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..just remember....Family is EVERYTHING!!

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Chart walker
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-remember the momentum bar trick on a MACD, that will tell you when short runs like that are coming and going... -wink

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID648573&cmd=show[s757 74020]&disp=O

I like this guy, real down to earth charting, a great place to learn about charts and indicators.

Have a great weekend peeps!

Chart ~

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The "BIG PICTURE" http://www.businessjive.com/nss/darkside.html

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SherriT
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Thanks Chart! Have a great weekend all!

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Study before you buy, Sell before you think about it....

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JLo
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Hi Chart and Others,

Some questions about the Huge Trick:

Is this: short put instead of buy calls, and short calls instead of buying puts ?


Also in,

"Since I had a PUT - I was going to short a Call ...". Jenna seems to be saying she's playing a combination. In this case a reverse synthetic stock consists of the combination she mentioned? I thought we were talking about straight calls and puts. I can use some help here.

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Jenna
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JLo- Don't mind what I said.....I already had in my regular orders when I went back & re- read the thread & saw Chart's "trick" then I was going to try that while I had my others orders already in and compare but my account is just virtual....

Also, those "trick" orders, most never went through because I would have needed 100,000 in my account..... [Smile]

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..just remember....Family is EVERYTHING!!

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JLo
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When done right, is it selling calls/puts, or combination of long + short as in synthetic stock ?
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SherriT
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I think Jenna is not buying long + short in the same stock....only simple calls or puts in the direction she expects.

Man, don't I wish this downtrend would continue on the cubes!

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Study before you buy, Sell before you think about it....

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Jenna
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Right Sherri- just simple Puts & Calls for me...

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..just remember....Family is EVERYTHING!!

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Chart walker
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http://stockcharts.com/h-sc/ui?s=QQQQ&p=W&b=5&g=0&id=p44383925418

Here's a weekly chart, we're going down SherriT! lol ~

Notice too that on a Weekly chart only once a year does the Stochastic fall below the 20 line of it's indicator... We are falling right for it!


See the support/Res line at about $43? Draw it from today back to the start of 2006 where it started, now our next "goal" is the $40 mark. That amount was set back at the end of 2004, beginning of 2005, see it?!

Now look along that line all the way to the present, the cubes bounced off that line both ways, up and down, so this is a strong area of support/Res and our next target!!! [Big Grin]

Booyaah!

Was nice stopping in!
Take care till next time!

Chart ~ [Smile]

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The "BIG PICTURE" http://www.businessjive.com/nss/darkside.html

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SherriT
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I'm learning...didn't buy my options early enough, but you can bet I will be there for the next round of calls in the summer! I should still make some nice money on them.

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Study before you buy, Sell before you think about it....

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Jenna
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Chart - what do you think about Goog- looks like it may continue to fall...

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..just remember....Family is EVERYTHING!!

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JLo
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March Expiration day! Hung on at the end to wins on GM,YHOO,UAUA..etc. Had to aggressively buy back CFC calls because it was running away. Market looks to CFC to survive and do well with less competitions among home lenders. I read it wrong, thinking it will at least stay flat among the carnage left by subprimes, corrected my mistake with small slippage and moved on. Didnt get my last day wins because of bad CPI report this morning and negative sentiments overwhelmed.
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Chart walker
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quote:
Originally posted by Jenna:
Chart - what do you think about Goog- looks like it may continue to fall...

Hey Jenna [Smile]

Dr. Joe is charting GOOG, it's about half way down the page, FYI ~

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID648573&cmd=show[s100 239080]&disp=O

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new2stocks
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[Razz] [Roll Eyes] [Roll Eyes]
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SherriT
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The cubes need to quit horsing around and fall already - LOL!

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Study before you buy, Sell before you think about it....

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milliam
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I agree Sherri...I'm right at my stop loss, but haven't broken it yet. The chart looks like we could go either way. Looks like a little support here, but will it hold?
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SherriT
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I believe it will go down, or I never would have purchased in the first place, though, I wish I had sold when it went up, bought back low, etc, even with the higher commissions.

Won't make that same mistake again...even if I don't get another entry.

This thing has historically started going down every year around April/May (noticeably anyway)....at least the last two years.

In short, I think we are good Milliam!

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Study before you buy, Sell before you think about it....

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Chart walker
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resist. 43.52 hit that area 17 times!

[get all resist/support levels here]
http://www.stockta.com/cgi-bin/analysis.pl?symb=QQQQ&num1=3&cobrand=&mode=stock

The overview...
http://stockcharts.com/charts/gallery.html?qqqq

The Details: --IMO [Smile]
http://stockcharts.com/h-sc/ui?s=QQQQ&p=D&b=5&g=0&id=p24333113037

Accumulation isn't anything to write home about...
CMoney Flow is Negative, and not racing to the positive side...
Stochastic is oversold and cycling which is giving us a head fake IMO.
Volume is the fuel for the fire, and clearly it has been drying up over the last couple days so I don't think much will become of this.

This is where "The Battle" is "resist. 43.52"

Surely it will try to break above it, then if it does it will retest this level, "if" that happens and it holds then it has a chance to run some more yet.

But with the low volume and negative CMoney Flow I think the Puts are just fine [Smile] IMO

Take care board
Chart ~

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The "BIG PICTURE" http://www.businessjive.com/nss/darkside.html

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milliam
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Thanks Chart...that makes me feel a little better.

So what would you see on the charts that would signal that the puts aren't just fine? Just wondering what I should be looking for.

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Chart walker
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quote:
Originally posted by milliam:
Thanks Chart...that makes me feel a little better.

So what would you see on the charts that would signal that the puts aren't just fine? Just wondering what I should be looking for.

Excellent question ~

Accumulation indicator pointing straight up and the CMoney Flow doing the same on rising volume...

That would NOT be good... [Smile]

But it looks to me like Stochastic has today and maybe tomorrow to run it's course before it's in the overbought range of the indicator and will then cycle downward.

Depending on CMoney Flow and Accumulation will depend on whether price climbs or stays about the same as Stochastic runs through it's cycles...

You can always look at BACKTESTS with indicators to milliam, note what they do before the price rises or falls, that's the best way to get a "read" on a stock.

--Example: Jan 10th CMoney Flow went positive and accum grew along with volume, -the price reacted to that and went higher...

I'm just not seeing "strentgh" in this chart for the current run, the history of the chart and indicators tells us what it needs to react a certain way, either up or down, so I have to call this a headfake...

-my 2 cents [Smile]

GL!

Chart ~

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The "BIG PICTURE" http://www.businessjive.com/nss/darkside.html

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milliam
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Thanks again!
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SherriT
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I sold my 43 puts the other day when the market went down, and bought 44 puts today cheaper than the 43s were...I'm getting it [Big Grin]

(Edit: Should have waited a bit more - darn thing is dirt cheap now!)

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Study before you buy, Sell before you think about it....

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milliam
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What the heck happened? I thought we were on course for a pull back and now!!!!

Crap!

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SherriT
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Now is the time to buy more....seriously.

We have three months basically until expiration...this thing gets even back into the 42s, and we have dollars....

I just bought some 45 puts at that price....I really wish I would have waited on the 44's, but it was still a good price.

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Study before you buy, Sell before you think about it....

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milliam
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Well, the volume has edged up today and the accumulation is still riding upward, but the Cmoneflow is still engative and we're almost into overbought on the full stoch.

Chart...what say you?

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SherriT
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It's already starting to go down again....back to our lovely 43.52 I'll bet [Wink]

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Study before you buy, Sell before you think about it....

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SherriT
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And then back up... [Frown]

We need a couple of days for it to settle down again - probably rallied because of the Fed decision.

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Study before you buy, Sell before you think about it....

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Chart walker
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http://www.investors.com/editorial/IBDArticles.asp?artsec=1&artnum=2&issue=20070 321

"Stocks Cheer Fed Message"

Right on SherriT!

I'll comment in morning [Smile]
--night peeps ~

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The "BIG PICTURE" http://www.businessjive.com/nss/darkside.html

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SherriT
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Night all! [Wink]

Mental note: We need to be paying attention next Fed meeting and be ready to BUY!

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Study before you buy, Sell before you think about it....

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JLo
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Took profit on YHOO Apr 25 Puts today - buy to close. Released margin$ to make other plays.

Shorted CIEN too. My April positions look firm but its too early to predict. Mkt can turn on a dime. I like to keep positions month to month.

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