Tuesday, October 22, 2013

Flash Crash..or whatever you want to call it.

Been a very interesting day so far.  Came into this week trading two names.  Calls in $AAPL and puts in $FB. I had weeklies in both and my plan was holding up pretty well. With that said, whatever that big sell off was, happened.  I was stopped out of my $AAPL trade and I took profit on $FB when it filled the gap. But something about this sell-off didn't sit right. With an $AAPL event today, these levels seemed too low. Like a gift on Christmas Eve. "Buy me now because after the event, I'll be back where I should be," it said to me. So I grabbed up some weekly 530 calls and sitting tight.

I kinda got the same feeling on $FB as well. It came down and filled the gap a lot faster then it should have. And it bounced just like a stock does when it drops too fast. I managed to get some cheap 54 calls on this name as well.  I was only playing $FB short this week because I thought it needed to digest that big up move. Since it did that rather rapidly, I was back in long, testing an earnings run into next week.

How I am playing this:  Both names have dropped out of the trading range on the 60 minute chart.  I am going to play these long back into the range.  I think $AAPL can even break out above if the event goes well.  If not, I cover back down to the gap fill...or... if they make it back into range, I stop out on another break below it.

Good luck out there. Panic never made anyone money.

Monday, October 14, 2013

$AAPL and the debt ceiling

Just wanted to put up a quick post this morning as I am watching $AAPL after a great close on Friday. Pre-Market is down about 1% after a weekend of people relaxing and over thinking things. Yes, it's another day of a government shutdown. Yes, there is still no debt ceiling resolution. But we all know these politicians love to hold out until the last possible moment.

That is why I was looking for a quick rally and gap fill right out of the gate from $AAPL. And got it. The Pre-Market drop didn't seem warranted given the lack of change or information over the weekend. And with this strong open, I am going to be looking for a break about $495, which is the top of my wedge. After that, any positive news out of the debt ceiling talks will drive $AAPL over $500, as well as rally most of the market.

Happy Trading.