duc's Commodity Trading Thread

[ducati916]

This chart demonstrates the premise for the trade more clearly:



There is a wide band of consolidation from circa $370/$380 down to $260. It would suit this trade very well if the stock bounced up and down in this range. You would make a nice profit on the adjustments.

jog on
duc

 

[fiftyeight]

Good, I'd like to see more of these types of trades (Stock/option combinations) in this forum.

Agreed this kind of strategy has always interested me but remained on 'reading to do list'

 

[ducati916]

My feeling, if I were to pick a direction, TSLA is headed lower.

We have earnings on:
Q4 2018 @ 20 Feb
Q1 2019 @ 8 May
Q2 2019 @ 5 Aug

For this trade, I'll catch 2 earnings releases. Should be enough.

https://www.marketscreener.com/TESLA-6344549/calendar/

jog on
duc

 

[ducati916]

So some basic calculations:

If in 20 days the stock should fall to $250: then

Calls = $21.54 = $4,308 [loss of $5,866]
Stock x 120 x $100 = $12,000
Profit = $6,134

At which point you could [obviously] close the trade.

If in 20 days price went to $450: then

Calls = $150 = $30,000
Stock = 120 x 100 = [-12,000]
Profit = $18,000

Again, you could close the trade.

The paying of time premium, is to allow the trade time to work if it just doesn't move that $100 in 20 days.

The second issue of course is: it trades to $50 up/down. What do you do? Let it run, it reverses, or, adjust and the stock continues to run. Can be frustrating. Less frustrating than stocks triggering stops, closing the trade and then reversing though.

Helps a lot if you can [reasonably accurately] pick major turning points. Now you can rake in profits.

Prices are theoretical prices based on B/S.

jog on
duc

 

[ducati916]

SHORT Gold.

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duc

 

[barney]

SHORT Gold.

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duc

Don't do that Duc … all my minnow Goldies are just starting to move.

It has had a steep run. What is your target to the downside? … Futures or ETF ? Cheers.

 

[ducati916]

Don't do that Duc … all my minnow Goldies are just starting to move.

It has had a steep run. What is your target to the downside? … Futures or ETF ? Cheers.

Futures.

I'm looking at circa 1250. That is on a daily chart, which on a weekly takes us back to the VWAP +/-

jog on
duc

 

[barney]

Futures.

I'm looking at circa 1250. That is on a daily chart, which on a weekly takes us back to the VWAP +/-

jog on
duc

Cheers. I reckon if you get 1250 you might get a whisker under 1240 ….. then hopefully onward and upward

 

[ducati916]

Close take profits.

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duc

 

[barney]

Close take profits.

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duc

So you are out Duc ?? …….. It was a swift move down so understand the profit take ….. Are you looking for another Short if it bounces quickly?

 

[ducati916]

So you are out Duc ?? …….. It was a swift move down so understand the profit take ….. Are you looking for another Short if it bounces quickly?

Yes closed the trade. I'll keep an eye on it for possible new trades long/short.

It is still trading lower. I would still look at the VWAP on a weekly for initial support, which is that 1250 sort of area.

jog on
duc

 

[ducati916]

TSLA having an uptick in volatility



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duc

 

[ducati916]

LONG Wheat.

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duc

 

[ducati916]

PALO ALTO, Calif., Jan. 18, 2019 (GLOBE NEWSWIRE) -- Tesla will post its financial results for the fourth quarter and full year ended December 31st, 2018 after market close on Wednesday, January 30th, 2019. At that time, Tesla will issue a brief advisory containing a link to the Q4 and full year 2018 Update Letter, which will be available on Tesla’s Investor Relations website. Tesla management will hold a live question and answer webcast that day at 2:30pm Pacific Time (5:30pm Eastern Time) to discuss the Company’s financial and business results and outlook.

If it keeps falling until an earnings surprise with a big bounce, that would suit this trade nicely.

jog on
duc

 

[ducati916]

So $250 would look to be a reasonable target:



At which point I would most likely simply close the trade.

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duc

 

[ducati916]

Hedge funds closed after booking losses trading oil and gas. Nearly 100 energy-focused hedge funds closed from 2016 through September 2018, taking the total number down to 738, according to Reuters and Eurekahedge. That is the lowest number of active hedge funds focused on energy since 2010. “There is a massive decline in the number of funds, and no replacements,” David Mooney, founder of Casement Capital, told Reuters. “There has been a near ‘extinction event’ in commodities hedge funds.”

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duc

 

[ducati916]

LONG NQ 6751.25

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duc

 

[ducati916]

LONG NQ 6751.25

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duc

So this was closed for a loss.

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duc

 

[ducati916]

Nice market neutral trade setting up in the futures. Will try and get a fill tonight.

jog on
duc

 

[ducati916]

Oil prices pause on weak China data. After hitting a two-month high in recent days, oil prices have taken a breather on renewed concerns of an economic slowdown generally, and in China more specifically. On Monday, China reported its 2018 GDP growth rate at 6.6 percent, the weakest in nearly three decades.

Rig count plunges. On Friday, Baker Hughes reported a massive decline in the U.S. rig count, with oil rigs falling by 21 and natural gas-focused rigs falling by four. The huge drop off is the clearest sign yet that the oil price downturn that began in October is starting to wear down the shale industry. Oil prices firmed up on the news.

jog on
duc