Market Curiosity: Exploring Markets And Systems

February 3, 2011

Long the Yen. Looking for a upward breakout from a triangle. -38% on calls, -450% on puts

Filed under: Long Calls, Mistakes, Short Puts — Tags: , — Jeff Fitzmyers @ 1:08 pm

Bought June 121 calls for 3.30.
Sold Feb 119 puts for 0.30.

+ Price just tested the 10 EMA.
+ Small consolidation under the trendline.
+ Notice in the chart below how price jumped up from the low 5 days ago.
+ Rising EMA’s
+ Weekly CCI now above monthly CCI.
+ Monthly CCI stating to rise.
– Daily CCI is high, but expected if a breakout is nigh.
± Commercials are net short, but not overly so.

Feb 10: Sold calls for 2.05 -38%. This is what happens when I try to put on a position just for the sake of action, while I’m under the weather. Since price is on the lower Bollinger Band and the daily CCI is getting low, will hold the short put with intention of exiting on a bounce. Bumped into this chart which tells me to never go long the Yen unless there is a very good reason.

Feb 15: Finally covered at 1.35 – 450%. Shoulda, coulda, woulda. “The first loss is the best loss.” The difference between the Yen and stocks is that currencies tend to trend, and stocks have the support of inflation. Also, I had a very small position so the dollar amount is rather small relative to the percentage amount. Things don’t seem so pressing if the position is down $100 rather than $10,000.

Feb 28: Whaa, the -450% kinda sticks out on the track record 🙂 And it also shows that, pretty much like every short put covered before expiration, there was a profitable way to exit if held long enough. (Until a black swan comes around… but then correct position sizing “should” attenuate the effects.)

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