Theta Trend

The Rundown:

This is a quick look at the open options trend following positions at Theta Trend.  Yesterday we had news from the Fed that moved equities higher, gold lower, and left bonds slightly down on the day.  I realize that the trend in stocks “seems” overextended, but I’m not here to fight trend.  Until we see a violation of a price based stop level and flattening long term moving averages, I’ll continue to be long.  Make sure to check out the video at the bottom of the post in which I tell you that I have no skill in timing (but sometimes I get lucky).

Russell 2000 (IWM):

I have two open positions in the Russell 2000 and both are naked puts.  I am short the Jan 14 96 Put and the March 14 94 Put.  I sold the March 14 put earlier this week and was initially taking some heat on the position, but it’s looking much better now.  It’s always hard to get long on a pullback in the trend, but for the time being everything is good.

Gold (GLD):

Gold moved much lower yesterday and I continue to talk to people that explain to me why Gold should move higher.  I totally agree with the reasons Gold should move higher, but until those reasons play out in price, it makes sense to stay short.  I am currently short the March 14 139 call.

20+ Year Treasury Bonds (TLT):

The reaction in Bonds yesterday was less impressive than I hoped, but price did end lower.  Obviously I wanted price to go in my favor and it did, but, hey, we always want more.  I am currently short the Feb 14 106/110 call credit spread.

Here’s the video: