Buy, Right?
So I’m breezing through some Dorsey Wright newsletter that found it’s way into my email, and lo and behold I see a blurb about buy-writes. They love the idea here. I don’t. Which does lead me to thinking, since among other things, they’re brilliant, and I’m not. So what am I missing?…
Original Source: adamsoptions.blogspot.com
I mentioned in my last post that we are possibly close to a near term bottom, but we need further supporting evidence on the chart to confirm. Well, the market is still continuing its free fall and it seems that no government intervention can put a stop to it at the moment. The above 10 year weekly S&P 500 chart shows that it has broken the 950 level support. Since its a weekly, chart, we will need to see if it can close below 950 on Friday to confirm it has indeed broken. But chances are high that it will now retest the lows we see in 2002 - around the 800 region. Because if it can’t defend the 61.8% Fibonacci, it will usually retrace all the way back. Don’t attempt to catch a falling knife. Wait for confirmation before going long.
Today’s dramatic last hour selloff resulted in new record high closes in four of the seven major U.S. volatility indices, including the VIX, which exceeded 60 for the first time and established a new record close of 63.92. In addition to the VIX, the VXD (CBOE DJIA Volatility Index) and the R…
All rise as we continue on Page 617 of this Bloomberg article. Remember, these blog posts read right to left today….
Lot’s of buzz about this article on all the coin minted by options traders this year.Well, that’s the implication, but it’s a tad more complex than that. Generally speaking, an increasing volatility environment is a good one for options traders. But that’s a broad statement, individual results can and will vary enormously. Someone’s also getting obliterated selling all that “fat” premium as it got twice as “fat” almost overnight. And someone’s also doubling down on DEEEPs on the way down too….