Loading ...Silver’s – Similar Chart Action
These last few weeks I haven’t seen anything noteworthy as far as positive price action in gold and silver, until now. Focusing in on the silver chart I see a very similar pattern of accumulation, to the 4 month bottom pattern between July and Nov. of last year. The pattern then, encompassed an initial low in July, the actual low right around Sept. 1st and the final, higher low in mid Oct. It subsequently rose $6.5 by Jan. 1. Currently, the first (and actual low so far) was in late June, the secondary low was in mid August and we have had a double low here in Sept. separated by two weeks, somewhat similar but not identical, to last October’s two week double bottom. I believe yesterday marked the bottom, but since I continue to expect sharply lower stock prices in the next few days,(I am still long calls on SQQQ since Sept. 1st) it is possible we have to wait a little while longer for the initial upward thrust that leads to a breakout.
Do you not have serious decay in holding those calls on SQQQ? A couple years ago I looked into options on triple leverage and I found the premium and the decay to be almost impossible to time properly. I would imagine the dealers clean up selling options on those. Are you in the green on those calls?
I agree we might see a short lived bounce in all things here. It could only be a day though, I imagine the latest jobs and GDP print will give us a bounce today. I think Powell will nuke it when he speaks after the close though. Not sure i will trade it though, may grab a small amount of puts depending on the close today.
You are correct about the decay in triple leveraged ETF’s which is why they are really only useful for relatively short term moves. Since I bought on Sept 1 (which was the exact recent high for NDX and low for SQQQ) and I kept my choice of strike fairly close to where it was trading, I am in the money(not as much as I would like but I still see the largest portion of the decline coming shortly. My target for SQQQ is between 24-30.
DSI Dollar 93
Gold 8
Silver 8
0 no one is bullish 100 everyone is bullish.
Daily Sentiment Index
OP: “Do you not have serious decay in holding those CALLS on SQQQ?” (emphasis added)
CM: “the decay in triple leveraged ETF’s”
TWO ENTIRELY DIFFERENT BEASTS.
Yes, there is decay in the leveraged ETFs. They are for shorter term trades.
But nothing like the decay in options, likes calls and puts.
If there was an unintended error in your note, by failing to distinguish, fine.
But options on leveraged ETFs are probably a road to ruin aside from intraday only.
Wrong. If you have an option that is in the money and the index either stays at that same point or continues to go in your direction your option stays where it is or goes higher. I don’t buy far out options so my premium is minimum to begin with. You have to know what you are doing. I have been using options since before the CBOE was created in 1973.
“I am still long calls on SQQQ since Sept. 1st”
There is serious decay on anything held that long.
Most of the options trading has shifted to 0DTE for that very reason.
All due respect CM, but your statement is factually incorrect. Regardless of in the money or out of the money, all options decay as you get closer to expiration if price doesn’t move. There is a premium the further out from expiration you are. If there wasn’t no one would write options! The fact you are playing options on triple leverage etf isn’t surprising now.
It decays but if the option is at 20 andd the vehicle is trading at 21 even on the day of expiration the option is still at 1. It only decays to the point of it’s instrinsic value. Yes if the vehicle drops below the strike it will decay to zero. It has nothing to do with playing options on a triple leverage ETF. If you are correct in the direction of the major index the option moves dollar for dollar with the index. The index ETF is the vehicle that loses value over time but I am not holding it for a long term.
“The index ETF is the vehicle that loses value over time”
Completely backwards.
They do not.
And what you mean, but don’t articulate well, is that LEVERAGED ETFs don’t TRACK their multiple over time. That’s due to SLIPPAGE (and daily resets), not decay. Do your homework!
Look at the chart. Since Sept. 1st SQQQ has gone from 17 to 21. If you own 19, 20 and 21 calls they have moved higher and if SQQQ keeps going up so will they. Of course with options you have premium time decay but if your position is in the money and keeps going in the desired direction your call moves point for point.
Wrong again. This whole thread has been about one specific ETF. The SQQQ. It is leveraged and all of my comments are specifically related to the position I took. The SQQQ is leveraged which is why I specifically chose it for this trade. I had a conviction that at the time I enetered the trade Sept. 1 The NASDAQ 100 would be falling. The SQQQ is designed to fall or rise 3 times the amount of the index. So far my call has been correct. Stop with yoyr BS trolling. Another member asked a question which I answered. Go back to your worthless posts and stop trolling mine with your childish gotcha’s. Everytime you do you show you don’t have a clue.