IWM Follow Up...

The IWM April $115 Put position from yesterday Going with IWM April (monthly) $115 Put was just closed, the main reason I closed it was a change in the TICK...

This is what the TICK looked like shortly after I posted I would be closing the position as it was always meant to be a short term position, from yesterday's IWM trade idea...Trade Idea... IWM Fade Trade

"I'm looking at a possible, very fast, very speculative trade, IWM short/puts....This move is parabolic and to me it doesn't look like 3C is improving, in fact in some cases like the IWM and SPY it is looking worse so I have that on deck and looking for confirmation to pull the trigger....I'll let you know before I do anything, just wanted to let you know I'm considering it as a VERY quick, likely 1-day position."

So first the trade was always meant to be short term in nature, this is when I use leverage like options, as a tool when I have good signals, but maybe not so much profit potential in a straight IWM short and we had good intraday reversal signals as of the close and with 3C those signals almost always pick up where they left ff the next trading day.

Also note I mentioned the F_O_M_C MINUTES "knee-Jerk" reaction (which is typically wrong) was looking very "Parabolic", again I don't trust parabolic moves, they tend to fail more spectacularly than they initially move.

Last, it was meant to be a short term play, likely a day or less, it was posted at 2:47 p.m. yesterday Going with IWM April (monthly) $115 Put and filled at $1.39, the exit was filled at $2.25 so I definitely left some on the table, but I never look a gift horse in the mouth. The P/L was a gain of +61.87% for approx. 3 hours of market exposure.

This is what the TICK looked like shortly after closing the position.

The IWM itself didn't look that bad (as far as closing the PUT), but it had gone from leading negative to in line pretty quick and I could see the ROC of price momentum falling off.

The Q's were throwing out a stronger signal telling me that this was likely going to start losing momentum and moving more laterally.

Also the Russell 2000 futures which had a great overnight negative divegrence on 1 and 5 min charts went to a relative positive divegrence, so I needed to get that warning out and wrap this one up and we'll look to see what opportunities are out there next, I suspect some of you did triple digits on this one so I'm happy with the outcome all things considered as a Fade trade on the F_O_M_C knee-jerk reaction.

Hope you did well.