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Thursday, November 13, 2014

Spiders (SPY) Nov 192 Put Options

9/24/2014 (9:03 am, PT)

sell to open 5 November 2014 $192 put options at $1.94

I received $970 immediately!

WHY did I place this trade on 9/24/2014?
  • SPY had come back down to its 50 EMA (see chart)
  • bottom of stochastics (see chart)
  • probability of success was 70%

On 10/15/2014, SPY dropped all the way down to $181.92 (see chart)

.

However, I was not at risk of early assignment because my put option still had plenty of "extrinsic" value remaining.  So, I left my position open.  What goes down must come up, right? 



11/13/2014 (10:41 am, PT)

buy to close all 5 puts at $0.09
WHY?
  • top of stochastics
  • take profits!
NET PROFIT:  $903.23   SUCCESS!



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