We have a little over an hour before the opening and the futures point to a strong start to the market. Right now the Dow futures are at +115, Nasdaq +42 and the S&P +15. Oil is up and gold is down. This all points to an up day; at least a strong opening. If we can be in the positive at the close this would be 3 in a row. We did not have 3 winning days in a row yet this year. This can be a good sign. Let’s not get our hopes yet, 4 o’clock is a long way off but there’s nothing like a strong start! Read my page “Pre-Market Data,” it explains the pre-market futures, fair value and the implied opening. It’s good to understand how these numbers predict the sentiment of the market.
Yesterday was a good day! the Dow ended up 222 points. I did not post a trades because I didn’t make any the way I preach. I did another day of “Day Trading.” Hit this link to my last post, Day Trading. Day trading is not something I teach but it’s a tool I use when needed. It’s very difficult to trade in the manner that I preach because my holdings are down from where I bought. It’s very hard to find good premiums without the risk of getting assigned. I normally like to get called out but my stocks are lower than where I got in so I don’t want to take the chance of losing my stock. I still have positions in Facebook (FB), Netflix (NFLX) and Gopro (GPRO). They are coming back but not to the point of selling options yet. Although, I do have a Call sold on GPRO to expire in April.
Yesterday I did another full day of Day Trading. It’s not what I love to do but it was a good day. The problem is I sat at my desk from 9:30am to 4pm with my finger on the trigger. I made 12 trades! This might be the most I ever made in one trading day. Every trade was with NFLX. I was playing NFLX like a piano! When it’s like this I do not have time to post. I do not enjoy a full day with my hand on the mouse and my heart beating a little differently. At the end of the day it was rewarding because I brought in $2800. NFLX was moving between 88 and 90 and I was going in and out with buy orders, sell orders, short orders and buy again orders. So far I had 2 days of day trading and every trade was with NFLX. Last week I brought in $2200 and yesterday $2800. I do not want this blog to take on a different direction and I do not recommend day trading. I’m letting you know what I’m doing while my stocks are down and the volatility is up. There are a lot of tool out there! Keep studying! If things get better soon there will be a lot of good opportunities coming.
The “Housing starts” report just came out. It was a little low and the futures dropped a little, but then the PPI report came out and that was up. The PPI is the Producer Price Index put out by the Bureau of Labor Statistics. I will be writing about the PPI soon.
Steve
The Options Coach