RE: 7/31/17 Follow along as @alexmorris and I try to save J.C.Penney (JCP) from Jeff Bozo and Amazon
8/16/17 update: OK, I'm sure you have been busy reading your new books. So that's why you missed the most rescent RSI "potential" buy signal. A lower low in price with a higher RSI reading. And now that the previous 4.51 low was breached, and a new low was set today...it is time to pay a little closer attention. yes, JCP still has a future date with sub $3 ..but teh future might not be right now. The DMI indicator is signaling a potential rally from around here. If one of those books you just received outline that...I'll buy the same book. :-)
If it rallies...you already know the "potential" uspide target. Is 20% in say a week an "OK" trade as far as you're concerned? I wouldn't even consider the trade personally. Not enuff chachingo for my personal preferences.
Ha! Sorry boss, I'm still paying attention honestly - I have a tab open in my browser with the JCP chart all the time now. I thought we were waiting until the $2.25 mark before we were thinking of buying, my bad. You seriously need to write a book my friend, the one that arrived was a waste of time and the other one on it's way will probably be as well. Its a pretty boring topic to read straight out of a book, especially straight after work. A book on a subject like this definitely needs your edgy sense of humour :).
But yes I'm seeing the signal. And I see too that the blue line has crossed the red line which I'm guessing is a positive indicator for you. Does that descending ADX line mean that the downwards trend is ending, and the rising RSI is indicating the start of a new trend upwards? I'm probably way off. I've been trying to find out what I can about this DMI business and pretty much the consensus is "yeah, it can sometimes help to find out what the trend is...", I've found nothing about calculating target prices from it. Where did you start out and how did you figure this all out?
I'm thinking of buying the book (..) by that guy who invented DMI but I'm guessing that you and others are most likely using it differently than he was, otherwise you probably would have sent me there already.
Haha, I think you know that a 20% return in a week would be "OK" with me. Would that be a trade with margin? Thanks for the update!
Yeah, screw the books...we are tracking it "live!" as either panic or greed takes over next. Interesting little ramp on teh open. If I was a daytrader I would have sold that move if I had bought my spew the night before...altho it was probly too late to buy when I mentioned the "potential" for JCP to run. It finished the day on an ADX buy signal ...which you don't understand just yet. But log this into your mammory banks...anytime an ADX sell or buy signal shows up on teh 10 day chart a rally immediately after that signal is "bearish" for the stock in question, JCP in this case. These ADX buy and sell signals happen pretty often. The windup is that JCP is now not a buy unless it sells off from here. What I think will happen is that the computers will "frenzy" JCP to 4.50+ before it sells off. If it does that we will see 2.25 very shortly afterwards. This shit is like a video game...cept more fun. But now you know what to look for with JCP ...a rally >>> sell. A sell off from here >>> Bullish >>> Buy! You just have to pick the "buyable" low. I have GREAT confidence in you :-)
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=62&y=19&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
I didn't check the options prices on JCP so I'll do that here "live!" as I'm spekkin to ye. With JCP near 3.50 the "obvious" options to check pricing on first are the $4. So for me to even consider the bet it would have to be in single digits per contract. Lets see what they are at right now.
Prices are actually pretty reasonable for a bet. In fact, if I was going to "gamble" it would be to the upside. The Sept 1 expiry $3.50 calls are at .25 market right here. That's a "fine" $150 bet. Buy 6 of those. You have 2 weeks for JCP to stay above 3.50 by at least .25 for a "breakeven" trade. Not bad...it gets you a seat at the table at least. But don't chase a gap up. Let's see what happens. If it gaps up on the open the odor doesn't get filt of course. I'm not going to trade tomorrow either unless USO dumps and I can exit my short position with a decent gain. But the JCP calls for 9/1 at 3.50 going for .25 per look like a decent lotto play here. If JCP dumps on the open you would "obviously" cancel this buy odor. Do it for me if I'm not around in the morning. :-)
Okay. A rally immediately after a buy OR sell ADX sell signal on a 10 day chart is bearish. Storing that in my mammaries now.
Eyes peeled for JCP in the next few weeks.
Did you manage to close your USO position?
Yes, store that one away as it is a pretty good tool for the toolbox. :-) Sometimes rallies after those ADX buy/sell signals result in new 52 week lows. JCP eliminated all of Fri's loss by teh end of the day so if it is going to rally it will be now...or else they "likely" go for my low buy numba. General marekt can go either way so JCP can go either way. My entire USO trade was a total loss. The lesson learnt with it is that sometimes it is best just to avoid making trades where the setup is there but the stock is kind of "stuck in the middle." I should have been more patient and waited for the trades that offered the highest likelihood of moving quickly, which were the market shorts I have been outlining. I would consider this JCP trade I outlined as one of those trades like USO. The chance is there for a 100%+ gain, but you "might" end up asking yourself >>> Why did I even bother? :-) There will be some very good trades coming in the general markets, VIX derivatives, and mining shares shorts. The last small lotto ticket I bought on SLV went out defunct on Fri also so I will switch to DUST long vs GDX short. Not quite yet tho.
That's interesting. Also interesting that you're bearish on mining shares.
Sorry to hear about USO, at least you're honest about this stuff boss. Thanks for the update man.
Shit, why not be honest? I play for the "mythical" 1000%er...the $100 bet that becomes worth $1000...and the faster the better. I'm just like everybody else in that I buy five $20 tickets and lose $100 periodically. The thing that makes me different is that I am going to "consistantly" post trades that generate 100% gains...and one recent trade (can't remember what it was but I think it was either the DIA trade or a gold trade) generated 700%+ if held until my target was hit. Methinks the trade in the sexy VIXens offers that kind of return. And 2 days ago I said >>> "UVXY coming all the way back to retest the 52 week low at sometime in the future." Just be patient and wait for the "proper" setup. If it doesn't come...no biggie...next! :-) I toldja this shit was easy. See how much better you are already...in like 3 weeks? Hope you understand the reasoning behind my JCP update. I was "hoping" for more but now the odds are looking like it would just be better to abandon with a small gain..."if" I even get that. If I don't...you then know why I said "this trade isn't really even worthy of consideration" when I posted it in the first place. I'm concentrating on long VIX and short gold via either GDX short or DUST long right now so check my blogs on those.
I'll open a new JCP blog when it signals the next "event." :-)
8/22/17 update: JCP now pushing towards 3.70 but if it continue to rally it will need to be a pretty strong move or else I would exit this long trade. Right now the 3/1 expiry 3.50 calls are bid at .21...down .04 from where the trade was initiated.
8/23/17 9:42 AM update: JCP pushed through 3.72 and a move to 3.85 would be the price I would look to for exit. Bid on my calls is now at .27. I would simply "stop out" if the asked falls to .25 and the spread is tight. So use a mental stop in this case as you would "likelY' get taken out with a mechanical stop. Sell at market once the bid hits .25. Let's see if I can get 3.85 tho.
8/23/17 11:09 AM: Bid on the 9/1 3.50C contracts is now at .30 as JCP trades at 3.79. A move to 3.85 gets me .36 market I'm wreckin...but a move to 3.90 increases the odds of getting $4+. So what would you do>>> 1) Play it "safe" and take 3/4 of your trade away "if" you get .36 (a 40%+ gain) in a few days? or 2) Be a hero, and hold for the whole sheabangie? ...ass-ooming it sees 3.90+ that is. :-) I won't tell you what I would do. I want to know what you would do. :-)
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=jcp&x=34&y=18&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
Nonetheless, see how eeeasy this shit is? :O Stop remains at .25 asked.
8/24/17 9:40 AM update: I don't think JCP will see the 3.90 numba that will assure more upside. And even if it does, there will be a pullback and another short term buy opp. Current bid on the 9/1 3.50C's is .39. I'll go "all out" of this trade with a 50%+ gain.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Stock&symb=jcp&x=35&y=16&time=18&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=7&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
Sorry man I just saw these posts, I didn't see them because I just check replies when I log on but you've been replying to your own posts, not mine so I missed them. All good though I just need to check the post and not replies.
I'm going to go through your posts in the morning when I'm not under the influence of a few post-work beers, I hope you understand ;) It's a little tricky for me because I have never traded in options before and I'm still trying to figure out if I can get a platform going here where I can do options, or even if its in my best interest to do options stuff, considering I work full time and all that. I don't expect you to care about any of this btw...
I liked your article about why people always lose trading options. A good post for newbs like me :)
I guess I was more interested in learning how you think about price action from charts. You say it's easy but I know that I've got a long way to go, so I'm prepared to.... read... books....
Maybe I'm best to wait for the next GFC and just buy stocks at the bottom. Like I did last time, even though I was too young to know what I was even doing.
I'm following all your posts and look forward to more good banter. Keep up your good work my friend :)
I'm trying to post my spews in direct response to the last pertinent spew just to keep things in order for myself. :-)