VolOp Launch
This is the first trade where I adjust my position sizing to account for the rising volatility in a ranging market that seem to have deeper drops whenever there are issues.
I call this stance in my plan "VolOp" and while it results in a 1% drop in my monthly target. It should weather my contracts better. This current adjustment is mainly based on YTD trades and increases my margin amount to 114k
Whats The Plan/Trade/Thought - RVLV
This is the first trade where I adjust my position sizing to account for the rising volatility in a ranging market that seem to have deeper drops whenever there are issues.
I call this stance in my plan "VolOp" and while it results in a 1% drop in my monthly target. It should weather my contracts better. This current adjustment is mainly based on YTD trades and increases my margin amount to 114k
Whats The Plan/Trade/Thought - RVLV
- Bearish inclined position for RVLV
- Overall Market is Ranging with negative news or concerns moving the market deeper vs positive news.
- The discretionary retail sector seems tied to major macro issues like supply chain and the increasing cost of importing goods
- RVLV is in a ranging pattern now. I have selected it as it is part of XRT holdings. I would prefer to enter XRT as it covers more companies. However it's options prices are terrible
- RVLV is the right price and previously on 5 Aug, while it had shown a solid earnings report. The company's conservative positioning caused a huge -24% drop. This shows in my opinion a lack of commitment and belief in the company's success and performance
I Feel
- I was very happy when I spotted this trade. I think this is a good strategy to take. Looking at companies that are aligned to the overall movement of the ETF. Especially when the ETF has terrible prices
Imagine Yourself Taking The Other Side
- RVLV has over exceeded earnings expectations for the part 3 quarters. This aligned with market optimism could fuel a bullish rush
- While it is ranging. The price movement has generally been higher lows
- 12 Oct News - Net sales increased 60% year-over-year to $228 million (and 41% over Q2 2019), while diluted net profit more than doubled compared to the year-ago period to $0.42 per share.
- 12 Oct News - Domestic net sales were up 59% and international net sales increased 63%. Gross margin increased 517 basis points to 55.6%, benefitting from healthy inventory levels and consumer demand dynamics. Also helping were higher sales at full-price and a decrease in “the depth of markdowns.”
- Strangely despite the positive news RVLV hardly moved
Imagine Yourself As A Neutral Observer
- The current price movement is ranging. with current highs not exceeding previous highs
- Any position needs to be outside of the range
Look For New Information
- I found very strong bullish news on the company and it's business
- 12 Oct News - Net sales increased 60% year-over-year to $228 million (and 41% over Q2 2019), while diluted net profit more than doubled compared to the year-ago period to $0.42 per share. (I also pasted this on the Other Side)
- 12 Oct News - Domestic net sales were up 59% and international net sales increased 63%. Gross margin increased 517 basis points to 55.6%, benefitting from healthy inventory levels and consumer demand dynamics. Also helping were higher sales at full-price and a decrease in “the depth of markdowns.”(I also pasted this on the Other Side)
How Do I Feel Now
- I'm ready and confident to press the trigger - Sell calls!
Trade Specs
- Sold 68 CALLS @ 0.8 Strike 90
- % to Strike 29.48%
- ATR % IS AROUND 47%
- BP used 47K
- Max Gain: est $5440
Trade geschlossen: Ziel wurde erreicht:
Yatta!