SHOP - low of bearish engulfing candle broken - PUTS

2020年7月7日

Shopify is getting attention for its ultra-rich valuation. Stochastic %K dipped lower on Monday, compared to June 24, and %D has crossed below RSI. Since stock traded below the low of Monday's bearish engulfing candle (with volume), I think today's buying will turn over as more people take profits.
I bought 7/17 850 puts for 2.90. Volume is low on these options, and risk is high. Reward to risk is also high, so if this trade makes you uncomfortable, ask yourself if you can be content buying one contract (using less than $300 capital)?

2020年7月9日

註釋

Sold puts yesterday for 2.50. Indicators and price action lean towards the trend continuing up. Stock dropped towards 1003 and was bought up very quickly.

2020年7月9日

註釋

correction, I closed half position.

2020年7月13日

手動結束交易

Closed remaining puts for a big loss. I had reason (technically speaking) to close the remainder on Friday but decided to hold until this week. I let other trade results influence my decision on this trade. I share this to offer a reminder/lesson - let each trade stand alone as its own transaction. Do not let gains and losses from the same day/week affect your trade management decisions. I still slip up (like this example) but much less now since I started treating each trade as a separate business transaction.