Last week, we realized $1,200 in our QQQ bull put spread trade.
We were initially long the QQQ calls – which would have better taken advantage of the run up that happened – but then on December 1 and 2 there were two big red candles in the Nasdaq that turned our winning QQQ calls positions into a small negative position (~$200).
In hindsight, we should have just kept the long calls because those would have eventually made money as we broke into new highs.
Still, not complaining about the $1,200 trade.
Net credit = $0.83
Quantity = 15 option spreads
Max profit = 15 * $83 = ~$1,200
Entry Date: December 2
Expiration Date: December 16
Days Held: 14
Silver dropped overnight from Monday overnight into Tuesday morning and pretty much opened at 9:30am at the lows of 15.68. However, we close at 16.11 — a strong reversal of sorts so far. Is the bottom finally in?
Earlier in the December 7 post: we mentioned that we sent a chart to members way back in October predicting that Silver would bottom near 16.35. That level was good for support until we hit resistance at 17.3 the day of the Fed and the Fed announcement reversed.
The next level of support would be near the 15.5 region as mentioned in chat.
After the big drop after the Fed announcement in silver, we were expecting a bounce towards the 16.25 region followed by a turn down towards the 15.5 as shown on the right.
What actually is we went up to 16.3 and then turned down to 15.68 before reversing strongly this morning over 16.1.
Here’s what the Silver chart looked like as we hit towards 16.25.
Of course, it wasn’t so easy holding through all the volatility if you were to short at 16.25 — but it never went higher than 5 cents above that level and did get quite close to our target of 15.5.
I expect silver to test this 16.25 resistance region one more time and perhaps dip below 16 towards 15.9, ideally.
What about Gold? Gold has been getting slaughtered. I sensed possibility of a truncated bottom the day after the Fed announcement last Thursday morning around noon.
Today, silver made a new low but gold did not
The major indices have pretty much just been consolidating so not too much new there.
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