DailyPlay – Closing Trade (T) Partial Closing Trades (VALE, INTC, BEAM) – August 30, 2022

Closing Trade

• T -109.68% Loss: Buy to Close 30 Contracts Sept 2, 2022 $18.50/$17.50 Put Verticals @ $0.65 Debit. DailyPlay Portfolio: By Closing all 30 Contracts, we will be paying $1,950. 

Partial Closing Trades

• VALE – 48.15% Loss: Sell to Close 15 Contracts Sept 2, 2022 $13.50/$14.50 Call Verticals @ $0.14 Credit. DailyPlay Portfolio: By Closing 15 Contracts, we will be receiving $210. We Partially Closed this trade on August 23 at $0.13 Credit, when we Closed 25 of the 70 Contracts, leaving us with 30 Open Contracts.
• INTC – 34.52% Loss: Sell to Close 1 Contract (Buy Jan 20, 2023 $35) / (Sell Sept 9, 2022 $38) Call Diagonals @ $2.03 Credit. DailyPlay Portfolio: By Closing 1 of the 3 Contracts, we will be receiving $203. 
• BEAM – 113.06% Gain: Sell to Close 2 Contracts Sept 16, 2022 $60/$50 Put Verticals @ $5.22 Credit. DailyPlay Portfolio: By Closing the remaining 2 Contracts, we will be receiving $1,044. We took Partial Profit on this trade on August 18 at $4.30 Credit, when we Closed 4 of the 8 Contracts, and then again, on August 23 at $6.47 Credit, when we closed 2 of the remaining 4 Contracts. Therefore, the average gain on this trade is 107.04% and the average cost basis to exit this trade is $5.07 Credit.

Investment Rationale

The SPX reached my near-term tactical support zone (4032/4023, where three unrelated technical indicators came together) and was the projected initial down move target from when I turned bearish north of 4270. I can’t make much out of yesterday’s action other than there was clearly some buying in there to offset selling from those stuck long from higher levels. Yesterday I bought some S&P futures in the fund I trade for at 4024. I’m gonna keep a tight sell stop on them but still think we could see a trading bounce this week from the confluence of three unrelated indicators (all near 4030) I explained in Monday’s OP webinar.

We see the market on a daily Setup -7 count coming into today, so we may very well see a terminal -9 count by Wednesday, but the bigger picture is what really matters. And we may get a better clue into that depending upon where Wednesday closes because the monthly chart (below) has a new look to it with the +13 count that came in because of where the August rally had reached. Closing beneath the Base Line (3960) is potentially another negative, while closing above 4132 would kill the down count and potentially make the picture less negative.

SPX – Monthly

As far as our Daily Play portfolio, let’s look at the short T Sept. 2nd $18.50/$17.50 put spread we have on. We are down 110% of what we collected, and with support having given way the past few days and yesterday also gapping lower and then closing beneath the -13’s Risk Level ($17.83), let’s cover our put spread today – half this morning and half nearing today’s close.

T – Daily

We’re long 45 VALE Sept. 2^nd $13.5/$14.5 call spreads. The market hasn’t really gone against us on this one, but time has. We’ve only got four days for this to work.  Let’s exit another 15 of the spreads today.

VALE – Daily

We are also long three INTC Sept. 9th $35 calls vs. short 3 Jan. 20th $38 calls. The Sept. calls expire in 11 days, and we’re down about 35% on the position, so let’s remove 1 of the three spreads we have on now.

INTC – Daily

Lastly, we have the remaining two long BEAM $60/$50 put spreads expiring Sept. 16th.  This was a recent large winner. With price against the cloud top, and my thoughts that we may still get a general market trading bounce, let’s take off the last two to lock in what was a 113% winner as of yesterday.

BEAM – Daily