Luna $ Ticks

November 18, 2008

Pure Magic

Filed under: Trading SPX SPY — moontrader @ 5:58 pm

In an incredibly choppy market I had a great day and it was in part to our dearest friend 2Sweeties. Check it out:

spx-111808

Just unbelievable! Pure magic! I dumped the calls I had in the beginning of the day, went short at around 86.5 SPY and then, towards the end of the day, I decided to try 2Sweeties model. I checked the level he suggested, closed part of my position, SPY reacted, I covered the rest, then I went long and closed the day with an amazing profit! The man is a genious! Click here for his website.

Anyway, it looks like we have some sort of rally, after all. I’ll be going short tomorrow again, or Thursday at the latest.

Here’s another chart I would like to show, which I showed early today: the breakout in the Treasuries triangle:

tnx-111808

The market has been extremely choppy, so it’s better to be careful. The scenario of a bottom sometime next week is absolutely valid, and I’ll spend the weekend with a nice chunck of puts.

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9 Comments »

  1. Nice play today Moon. Hope your right about a new low, loaded up on puts today near the interday high

    Comment by jigsaw — November 18, 2008 @ 6:36 pm | Reply

  2. What prompted you to go short at 86.5? I’m working on 2Sweeties’ retracement levels as well and that looked like it was a “low probablity” reversal level. Thanks!

    Comment by John — November 18, 2008 @ 6:37 pm | Reply

  3. Glad you had a good day. Does the S&P moving to 960 invalidate your thoughts at all? Just wondering since it’s max pain for this month on SPY. I’m thinking it probably will peter out before getting there, but would appreciate your thoughts.

    Comment by Susannah — November 18, 2008 @ 6:40 pm | Reply

  4. John, I wasn’t working with 2Sweeties model until towards the end of the day, when I decided to cover based on his numbers. I got in just because the market was up.

    Susannah, the market has been incredibly choppy, just look at the alternating red and black bars: after 10/10 you don’t see more than three consecutive days up or down. I’m not sure about 960, but 920/930 would fall on DMA 25×5 if it happens tomorrow, and that for me would be a great entry point. However, for the scenario to work, we would need to see SPX reverting followed by a considerable drop already on Thursday or Friday.

    Comment by moontrader — November 18, 2008 @ 7:08 pm | Reply

  5. Mmmmm, isn’t the break down in TNX bearish? Yield going down means people are bidding up notes (flight to safety).

    Comment by Sia — November 18, 2008 @ 7:19 pm | Reply

  6. I bought TLT calls a few days ago, Dec. 96’s. The volatility was at 18, so they were the only cheap options I could find. They might still be a good way to play the Treasuries.

    Comment by JamesD — November 18, 2008 @ 8:13 pm | Reply

  7. Moon, do you mainly just trade SPY options? That’s what I do and it is just so simple!

    Comment by tradertom — November 18, 2008 @ 8:22 pm | Reply

  8. Hey James, thanks for the tip. I use other indicators and assets in my studies, but I basically trade only SPY options. Just because I’m more familiar with its behavior.

    Comment by moontrader — November 18, 2008 @ 8:30 pm | Reply

  9. Moon, do you think tomorrow will be the low instead of on November 25th? Thanks.

    Comment by Playa Del Carmen — November 19, 2008 @ 6:41 pm | Reply


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