Maybe so. An article said a large portion of ENPH biz is in Europe and that economy is sunk and has no sign of turn around.
-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Has anyone used and figured out Fidelity's Margin Calculator tool?
I have been trying it (just now), picked "Model Stock Price Change" and set TSLA to be 200.
When I do that, my Margin BP increases a large amount, along with Non-Margin BP and House Surplus. This isn't what I'd expect and I'm pretty sure it is wrong. Seems to be related to weird option price changes they make.
For example, when I change the SP to 200, all my BPS option prices drop, which I don't get.
An example a 2/17/2023 BPS shows the current prices:
P240 $44.65
P205 $23.55
After I change the SP to 200 it now shows
P240 $0.43
P205 $0.16
Tried to call Fidelity but the traders go home at 5pm EST so will have to wait till Monday, unless someone here can explain?
I have been trying it (just now), picked "Model Stock Price Change" and set TSLA to be 200.
When I do that, my Margin BP increases a large amount, along with Non-Margin BP and House Surplus. This isn't what I'd expect and I'm pretty sure it is wrong. Seems to be related to weird option price changes they make.
For example, when I change the SP to 200, all my BPS option prices drop, which I don't get.
An example a 2/17/2023 BPS shows the current prices:
P240 $44.65
P205 $23.55
After I change the SP to 200 it now shows
P240 $0.43
P205 $0.16
Tried to call Fidelity but the traders go home at 5pm EST so will have to wait till Monday, unless someone here can explain?
With the exception of holding the government ransom with the debt ceiling, again, I don’t believe there’s any way for them to reverse the credits before 2024, no?
APPL is down past 2-3 days because of COVID shutdown to their main factory in China , IIRC (per headlines read)
I'm reading that Foxconn is in closed-loop and it has zero impact on production - but could be fear of more disruption, might also be spilling over to TSLA as well
The loop is not completely closed:
/cloudfront-us-east-2.images.arcpublishing.com/reuters/DYGJFSVVB5NAXLEUM2USOGXGAA.jpg)
Fearing COVID, workers flee from Foxconn's vast Chinese iPhone plant
After enduring days of lock-in at Foxconn's vast facility in central China with 200,000 other workers, Yuan finally climbed the fences on Saturday night and escaped the complex, joining others fleeing what they feared was a widening COVID outbreak.
I had been thinking more about day trading shares instead of doing options. I've been trying to use RSI, MACD, and now the Fibs on both TSLA and the NASDAQ. I'm finding it more difficult than I though it would be because of how TSLA moves.
Problem 1) When the SP is going up or down, it usually ticks back and forth enough that you need a 50 cent or $1 gap in your price and your stop. This means that if you are wrong, it is going to cost you. Also, If you predict TSLA will climb and you buy, it will often climb $1-2, come back down to your stop loss, and then climb for real (so you have to keep getting back into the trade). So you are doing LOTS of trades and sitting at the computer all day.
Problem 2) Patterns work until they don't. I had seen previously that when the RSI drops really low (into the 20s), there is almost always a bottom, which makes it the perfect time to buy. However, during yesterday's big drop, it hit very low RSI, and stayed there forever as the SP dropped from the 220s to 203. Luckily I was listening to Dan Shapiro and even though I was skeptical that the SP was going to drop as much as it did, his words kept me from buying in (and losing a ton of money), and eventually I listened to him and actually went short by selling some of my shares and buying back in lower.
Where I stand now:
With many traders calling for SP below 200, and possibly as low as 170/180, I think I need to sell some shares for extra cash and increase Margin buffer. I will probably go back to selling CSP and doing CC, near the money, about 3 weeks out, using 1/3 of available liquidity. This way if the SP moves and current B/W become worthless to roll (because the SP has dropped 10%) I can sell more contracts at the new SP. I have been hesitant to do this because I have believed for months that the SP is about to take off, but I need to make some money if the SP trades sideways or drops for what could be the rest of the year.
I learned that I was day trading stock all wrong. What Dan Shapiro is always preaching is that you can't go looking for a trade, it has to come to you. If you are making 8 trades/day, you're doing it wrong. Trying to profit from little up/down moves in the SP is too difficult because of Problem 1. That is why a professional trader like Dan looks at multiple different stocks, and just trades the ones that are at the limits of major supports (up or down) when they break through/confirm. Out of 20 stocks he might be looking at, he might only trade a couple names on any one day (or not trade at all), and he doesn't go until the price action confirms the potential break he identified before the market opened. He makes money whether it is a Bull or Bear market, because he doesn't care if the market is being irrational (I don't think he knows or cares what TSLA's PEG is now). So day trading just TSLA doesn't work for someone like me that only trades one stock and pulls his hair out when company valuation says one thing, and the market seems to ignore it. Furthermore, TSLA doesn't move big predictably every day. Yesterday was the first day he had traded TSLA all week and he made a killing (he was looking to go long Tuesday, but the play didn't materialize, and he finally went short yesterday when the SP broke through the moving averages he was looking for). Meanwhile I had traded TSLA on small moves all week, probably did more than 30 separate orders, gave myself an ulcer, and made very little.
Problem 1) When the SP is going up or down, it usually ticks back and forth enough that you need a 50 cent or $1 gap in your price and your stop. This means that if you are wrong, it is going to cost you. Also, If you predict TSLA will climb and you buy, it will often climb $1-2, come back down to your stop loss, and then climb for real (so you have to keep getting back into the trade). So you are doing LOTS of trades and sitting at the computer all day.
Problem 2) Patterns work until they don't. I had seen previously that when the RSI drops really low (into the 20s), there is almost always a bottom, which makes it the perfect time to buy. However, during yesterday's big drop, it hit very low RSI, and stayed there forever as the SP dropped from the 220s to 203. Luckily I was listening to Dan Shapiro and even though I was skeptical that the SP was going to drop as much as it did, his words kept me from buying in (and losing a ton of money), and eventually I listened to him and actually went short by selling some of my shares and buying back in lower.
Where I stand now:
With many traders calling for SP below 200, and possibly as low as 170/180, I think I need to sell some shares for extra cash and increase Margin buffer. I will probably go back to selling CSP and doing CC, near the money, about 3 weeks out, using 1/3 of available liquidity. This way if the SP moves and current B/W become worthless to roll (because the SP has dropped 10%) I can sell more contracts at the new SP. I have been hesitant to do this because I have believed for months that the SP is about to take off, but I need to make some money if the SP trades sideways or drops for what could be the rest of the year.
I learned that I was day trading stock all wrong. What Dan Shapiro is always preaching is that you can't go looking for a trade, it has to come to you. If you are making 8 trades/day, you're doing it wrong. Trying to profit from little up/down moves in the SP is too difficult because of Problem 1. That is why a professional trader like Dan looks at multiple different stocks, and just trades the ones that are at the limits of major supports (up or down) when they break through/confirm. Out of 20 stocks he might be looking at, he might only trade a couple names on any one day (or not trade at all), and he doesn't go until the price action confirms the potential break he identified before the market opened. He makes money whether it is a Bull or Bear market, because he doesn't care if the market is being irrational (I don't think he knows or cares what TSLA's PEG is now). So day trading just TSLA doesn't work for someone like me that only trades one stock and pulls his hair out when company valuation says one thing, and the market seems to ignore it. Furthermore, TSLA doesn't move big predictably every day. Yesterday was the first day he had traded TSLA all week and he made a killing (he was looking to go long Tuesday, but the play didn't materialize, and he finally went short yesterday when the SP broke through the moving averages he was looking for). Meanwhile I had traded TSLA on small moves all week, probably did more than 30 separate orders, gave myself an ulcer, and made very little.
Last edited:
I dunno, my intuition is day trading requires a lot of attention, good systems support and a great deal of knowledge and flexibility to be successful. The more ordinary trader (like us) is unlikely to be successful. I don’t have the time or interest in making the investment to educate myself, so I try not to think about the lost opportunity. It does seem like Dan is in the successful category with his approach and resources.
Dan typically does not use all those indicators that you mentioned. If you are planning to follow his process it could get confusing if you were to follow all those other indicators. Never heard him use the words MACD or RSI.
I actually had my most successful week in a while. It took a lot of work but it also required taking profits instead of waiting till expiry, got in and got out plenty of times as Tesla broke through those levels.
The majority of daytraders lose money. This is a fact.
The majority of option buyers lose money. This is a fact.
That’s why we are option sellers, that’s why we are The House.
But don’t use margin!
The majority of option buyers lose money. This is a fact.
That’s why we are option sellers, that’s why we are The House.
But don’t use margin!
Exactly. He jokes about not using them, or VWAP. He uses many different moving averages and Bollinger bands, and believes that SP movements will find resistance at the different moving averages and Bollinger bands. He also uses recent high/lows. So if a stock has dropped below the 50 day, the 200 day, and previous lows, etc., it's probably going to keep going down. Opposite on the upside. When TSLA would break through the upper Bollinger band in the past, I thought that was an indication that it would stop climbing to get back inside. But he sees that as a sign it could run for a while. I trust his method now, I just don't know if I want to trade other stocks and spend so much time trading. Before TSLA's SP dropped 50% and put me into margin trouble, I would open my BPSs on Thur/Friday for the following week, and not do much for many days. Those were good times....
Edit: I'm going to follow him a little longer. If he calls that TSLA is confirming a big move, I will immediately sell options for the opposite direction and try to make profit in a couple hours.
Last edited:
It is crazy to think that the SP at $180-170 it's only a 10-15% move from $200. I wish the market felt like it's turning around to jump into Leaps... Maybe if we get a good sense about that for Q4 we are going to beat the delivery consensus I might get some calls. As far a CC's I am going to try to be very safe and maybe sell ATM CC's if we hit $300.
Yeah, there's no reversal of the IRA EV credits unless Republicans gain control of the White House. They're safe for two years minimum.
I just finished a book on day trading and yes, it is a fact that majority of day traders lose money.
However, if you daytrade with the same 5 indicators, only get in trades when your indicators are met, you have back tested your indicators and have more than 70% success rate in trades, always respect your exit plan with stop losses, you will make money.
The daytraders who lose money are the ones who are not 100% commited. You have to check down your charts, follow your indicators and when they are met, make a move. Never double down on a losing trade, get out.
Day trading is the opposite mindset of the long trades. One is about cutting loses asap, the other one is about DCA your way down to the bottom.
If you are commited to daytrading and follow the indicators and make moves only when they are met, you will be successful. The majority of day trader don’t do that. But the minority who stick to their back tested indicators will make money.
My take on TA is that it is essential to know the support and resistance levels to know where to select your next strike price if you need to roll a losing position in option selling. I do select strike price base on resistance level when rolling CCs. They have shown to be reliable as long as there are no major unexpected event like a undesired tweet. TA is the healthy counterpart to eternal uncompensated Uber bullishness.
Last edited:
AquaY
Member
The options trader that ignores TA is setting himself up for a beating
And don’t forget to leave your emotions at the door. Most day traders lose money because of greed and fear. Many have a strict plan, but it goes out the window the moments emotions take over. And that happens all too often.
I think even most of the retail/day traders trying to emulate the House lose money
trying to be house without being able to bend rules like naked shorting etc etc ...Based on the postings/ramblings here .. I think there is only 1 person in my head who consistently makes money
(maybe more, but they don't share as often)+BUYING/SELLING is different from being LONG/SHORT and right now all strategies that are LONG TSLA are not really working ...
Margin Mgmt is definitely key.
With buying you take like 10% risk and have possibility of 90% gains. Wrong trade on selling side and you take 90% risk for 10% gain. One or two wrong bets on selling side and account will get wiped out. cheers!! (+ i've been trying to do both ...)
Last edited:
This is kind of what I've been saying for years in that I don't think we can predict short term movements consistently. This is well studied statistically (e.g. random walk theory).
However, stocks do not have perfectly randomly distributed price movements over time. Once in a while, there is a totally abnormal price movement, and that is the moment you may have an edge in making a profitable trade over time.
For example, take the most obvious metric to track - daily price change. About 8-10 years ago I tried to build a machine learning algorithm to predict price movements of all stocks in S&P 500. The algorithm was not better than random except when looking at a particular condition.
That condition was: only look at stocks that gained > 20% in one day. The profitable trade was to short those stocks for the next day then close the position. Interestingly the opposite wasn't true (didn't work for stocks down -20% in one day).
The point is those 20% days are clearly statistically outliers and that's where there is room for profit. If you follow a set of metrics and only identify outlier situations, I bet you can profit, especiallly if you apply other techiques on top of it (using TA for entry, or valuation models).
I haven't gotten back into this mode of trading but would like to. I'd probably build a much more advanced ML model first, but it's not necessary.
A valuation based method could also work. Take a look at NFLX. The stocked tanked in April (even worse than market) because of fears of slowing growth / competitors. Not only was the stock an outlier in huge price drops, the PE ratio was like 15-17 for a while. Now I'm sure indicators would have said the stock was oversold. That and the fact the PE ratio was so low and the fact that I though NFLX was probably in a better situation than the market thought meant it was in an outlier situation. I definitely thought about buying NFLX in the 180s but didn't act (since mostly in TSLA). Now the stock is up 44% from that level.
Being patient and only trading when a stock matches a suite of your metrics to be considered an outlier situation signficantly enhances chances of winning (IMO) and reduces downside risk.
Similar threads
