AprWk4 - GLD Market Summary. Gold is officially in no-man's land. The ichimoku charts above shows exactly that, they are no where near the promise land, but nevertheless, it should not matter for those selling options because deep in those red images of doom and gloom, there's money to be made.
Needless to day some risks had to be taken, but as they also say, no risk no gain! So last night I took a risk. While the GLD market was seemingly still rather volatile, I decided that I would either sell when GLD was at its peak or when GLD was at the intra-day low. These were the only opportunities for me to enter the market with either a Call Spread or a Put Spread.
I decided to sell a Put Spread eventually when GLD decided to dip somewhere after 11.30am US time. The Bollinger Bands showed very clearly where the market was headed, and I missed the first opportunity of a Call Spread.
Subsequently when it was at the lowest point (See Diagram below), I finally managed to catch a Put Spread that had sufficient safety and locked in a trade for GLD Put Spread $138.5/139.5 for a premium of $0.07. I also placed an auto cut loss on advance order in the event that spread is greater or equals to $0.23. The contingent order would kick in and I would lose a total of $0.23-$0.07, which was $0.16. I set that as my max loss that I would wanna lose for the trade.
Thank God that has worked out fine. :) GLD finally closed at $140.91 after an uncertain and very volatile trading day last night. My trade expired worthless of course. :)
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