Got GLD Puts?
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Got GLD Puts?

John F. Carter 12/20/2013

Welcome to the free video for simpler options and today we're going to look at the spiders (SPY), and this is a trade we had set up today. And if you notice, we got a 30 minute chart over here, and a daily chart over here. You'll notice that obviously we had a big day yesterday, the potency we trade sideways. And if you look at the spiders on the daily chart there's no squeeze and on the 30 minute chart there's no squeeze.

Take signals from the futures

Now part of the ETF class I did I would say that look, if you've got any ETFs you trade always chart and take signals off the underlying futures because underlying futures will give you a more accurate signal. So here's a stark example of that. So with the S&Ps obviously mimic the spiders. Here you've got a daily squeeze and a 30 minute squeeze. What I'm fully expecting here is that this squeeze will continue pushing stocks higher tomorrow or early next week with a first target around 1813. OK. So on something like that's about a 10 point move in the S & Ps. So that's a 1 point move in the spiders. OK.

And so you can come back here and what we did in the room today is we bought SPY calls with the idea that, you know, we bought them at 181.50, the idea that they would go to 182.50. OK.

Then we did a call yesterday in the room. We did this trade in GLD and this one, everything was lining up here. This was a very very sweet trade with a daily squeeze, we had a 30 minute squeeze right here. This is where we actually put on the puts. And if we look at this -- I mean I did the trade in the futures contracts too. I mean a pretty sweet move there. But, on something like this -- in the room we just bought puts, in the money puts on GLD and that had a really sweet day today. I really like this trade -- put on a full position. You know, all we did -- I mean we just -- you know again, you don't have to.

When you see a good set up like that you don't have to have a triple to make money on it. If you've got a great set up you could do bigger size on it. You risk the same; you could just do a smaller stop. But you know, 4.88 to 7.60, and in this case, 4.80 to 6.70. That can be sizable when you put some size behind it and continuing to look for a little bit more down side. And I'll talk about you know, where our targets are in the premium video. All right. That's all I got. I hope that helps and we'll see you at the next update.