Trading Journal Report For 3-20-2014

Well, today’s gains on the S&P500 index (and other major US indices) essentially erased all of yesterday’s losses, putting us right back where we were on Tuesday, sitting right around last week’s highs. This has not been our favorite market conditions lately. We even managed to miss out on trading the one day that markets did behave in a favorable manner. That would be yesterday. But it is what it is, and it’s how things actually turned out that’s important. As for that, it was yet another day of low-confidence trades, ending in mixed results. For the week as a whole I believe that we are about $100, which isn’t terrible. But it sure isn’t profits, and that’s what we’re here for.

s&p500 index daily chart for 3-20-2014

After taking a look around at some of our favorite underlying assets to trade on, and not seeing anything which looked particularly promising, we eventually came back to one of the first charts we had looked at, the VIX volatility index. It had just recently experienced a relatively steep drop, and we felt that at these levels there was a reasonable chance of getting a bounce into ITM territory prior to expiry. Our “bounce” did not happen, unfortunately, and this trade finished OTM. That’s the third day in a row of starting from a negative position. Luckily we have managed to mostly come back from them and claw our way back up around the break-even level.

vix volatility index trade for 3-20-2014

VIX Index Trade Summary – High/Low Call Option

Trade Outcome: OTM
Entry Time / Expiry:
 16:19 / 18:00
Investment: $100.00
Returns Offered: 70%
OTM Refund Rate: 10%
Entry Rate / Expiry Rate: 14.90 / 14.74
Returns Received: $10.00
Profit/Loss: -$90.00 Loss

Next up was a silver play which came nearly an hour after our first trade. This was actually a really nice technical setup. Certainly nice enough to take a $100 shot on at the very least. And in fact you can probably see what it was that we were trading on just in the chart below. Price was just flirting with a level which it had reached, and failed to break several times already in the last eight hours. While there is certainly no guarantee that this won’t be the time it does break through that price level, but speculation is a game of odds, and your odds don’t often get all that much better than this. And this time the odds did indeed play out the way we predicted, for a solid ITM finish.

silver trade chart for 3-20-2014

Silver Trade Summary – High/Low Put Option

Trade Outcome: ITM
Entry Time / Expiry:
 16:55 / 18:00
Investment: $100.00
Returns Offered: 76%
Entry Rate / Expiry Rate: 20.4280 / 20.4015
Returns Received: $176.00
Profit/Loss: +$76.00 Profit

At the same time that the above two trades were open — with both having two-hour expiry windows — we also opened a third standard high/low trade, as well as a couple of the Ladder option contracts offered by GOptions. Let’s talk about the high/low option trades first though. With just 15 minutes till the 18:00 expiry of our first two trades, we opened a third trade with the same 18:00 expiry, but on the S&P500 index. This was a similar setup to the one above, but in the opposite direction, and not nearly as high-probability. We got in on the move a bit later than we would have liked. However, in the end it was good enough for another ITM finish.

first s&p500 index trade for 3-20-2014

S&P500 Trade #1 Summary – High/Low Call Option

Trade Outcome: ITM
Entry Time / Expiry:
 17:44 / 18:00
Investment: $100.00
Returns Offered: 76%
Entry Rate / Expiry Rate: 1871.49 / 1872.52
Returns Received: $176.00
Profit/Loss: +$76.00 Profit

The last regular high/low trade we made today was also on the S&P500 index. Unfortunately, this one didn’t go as nicely as the first one did. In this trade there was no set floor to even hope for a “bounce” off of, and we’re not sure what even got us into this trade. This was simply an ill-advised trade against the prevailing trend. Count this a valuable learning experience. As long as you DO recognize and learn from your mistakes, you’ll do just fine in the long-run. We often learn more from our mistakes than our successes. Well, this OTM finish takes us to 2-and-2 for the day, an even split for a mild loss. So it looks like it will be up to those Ladder option trades to determine the final outcome.

last s&p500 index trade for 3-20-2014

S&P500 Trade #2 Summary – High/Low Call Option

Trade Outcome: OTM
Entry Time / Expiry:
 19:14 / 19:30
Investment: $100.00
Returns Offered: 76%
Entry Rate / Expiry Rate: 1869.56 / 1868.37
Returns Received: $0.00
Profit/Loss: -$100.00 Loss

Now for the ladder option trades, finally. We are having a blast with these unique contracts at GOptions. Even better is that we’ve had some good luck with them so far (and there was most definitely some luck involved), going 3-for-3 in the last two days. And these are long-odds contracts.

eur/usd ladder option trade chart 3-20-2014

We made two ladder options trades today, the first of which was on the EUR/USD pair shown in the chart above. We made this trade for 2 contracts, which is $50, and took a position for a “below” finish for the green line. This trade was only offering a 49.1% return, but it is also already fairly far ITM at the time of entry. One of the many cool things we are discovering about these options. So this trade actually wasn’t a “long-odds” trade at all. The odds favored us! And in fact this trade did finish ITM, for a $74.55 return on our $50 investment. Not bad for such good odds.

EUR/USD Ladder Options Trade Summary

Trade Outcome: ITM
Ladder Trade Type:
 Below @ 1.37901
Entry Window / Expiry: 16:30 / 17:30
Investment Amount: $50.00
Returns Offered: 49.1%
Returns Received: $74.55
Goal Rate / Expiry Rate: 1.37901 / 1.37817
Trade Profit/Loss: + $24.55 Profit

The final trade today was the other ladder option, but this time on the AUD/USD currency pair. We don’t have a picture of the chart at our entry point but instead have the GOptions expiry charts for both the expired ladder options trades made today. This second trade went as well as the first one did, but was offering a much better return rate. Let’s take a look.

ladder options trades goptions expiry charts 3-20-2014

The screenshot above show a snapshot of the ladder option asset charts in the minutes right around expiry. In addition, to the right it shows you price snapshots taken in the few seconds before and after your expiry. While this certainly isn’t the best view of this trade for explanation purposes, this is a cool feature. As you can see this second trade didn’t go as well as the first, yet didn’t lose either. It was in fact a tie. I can’t imagine that happens very often with these contracts, but it happened this time anyway.

AUD/USD Ladder Options Trade Summary

Trade Outcome: TIE
Ladder Trade Type:
 Below @ 0.90454
Entry Window / Expiry: 16:30 / 17:30
Investment Amount: $25.00
Returns Offered: ???% (did not record, oops)
Returns Received: $25.00
Goal Rate / Expiry Rate: 0.90454 / 0.90454
Trade Profit/Loss: + $0.00 Profit

Which finally brings us to the day’s totals. We made four standard high/low binary option trades, and two ladder option trades. Of the standard trades it was a 2/2 split for a mild loss. And for the ladder option trades it was a small win and tie, for a mild gain. Altogether it just about even itself out. Yet again.

daily goptions investment history totals 3-20-2014

Daily Investments History Totals For 3-20-2014

Trades Entered: Four (4) High/Low + Two (2) Ladder Options
Standard Trade Outcomes:
 Two (2) ITM + Two (2) OTM
Ladder Trade Outcomes: One (1) ITM + One (1) TIE
Total Investments: $475.00
Total Returns Received: $461.55
Total Daily Profit/Loss: -$13.45 Daily Loss
Daily ROI: -2.8% Daily ROI

Another day of small losses is another day of no profits. That’s the glass is half empty view. On the other hand, we’ve managed to keep all of these days of losses to very small amounts, which should easily be erased by just one or two good winning days. That’s the glass is half full view of things. At any rate, until next time, trade smart and be lucky!

Monday, 17th Trades | Tuesday, 18th Trades | No Wednesday Trades

Leave a Reply

Your email address will not be published. Required fields are marked *