Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Short-term Extremes in Emerging Markets…Potential Trade?

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The market continues to teeter at the top.

Approximately 58.5% of the ETFs we follow in the daily options blog are in a short-term extreme state at the moment. Typically when we see levels this high a short-term reprieve follows.

One of the reasons the ratio is above 58% is the international ETFs. All of the highly-liquid international ETFs we follow are in a short-term extreme. India (EPI) is by far the most overbought at the moment, but it’s actually the emerging markets ETF (EEM) that has drawn my attention. (more…)

My Short-Term Market View Has NOT Changed

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My view hasn’t changed since the middle of October. …this market is set-up for a nice decline.

And so far, while my view hasn’t been realized, the market hasn’t rallied further. In fact, the tight trading range at all-time highs has proven to be an excellent area to sell credit spreads. Moreover, I think the major benchmarks could be trading at levels that offer a  wonderful opportunity to take a few short-term aggressive plays like buy a few puts. I typically, don’t buy options, but at these levels it’s hard to pass up…and we’ve actually had very good fortune buying puts over the past month. So, if you are a subscriber, stay tuned because there is a very good chance that I will be adding to our December positions tomorrow. (more…)

A Few Short-term Opportunities in Sight

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Admittedly I haven’t placed many trades over the past several weeks. Some may say that the more you trade the better. Increasing your sample size is the key to success. Trade small, trade often.

In some cases, yes, but if you are only trading a limited amount of highly liquid ETFs I’m not so sure it makes sense. Wait for the set-up to come to you…don’t force trades. And yes, while no one knows the destiny of the next move, why not allow pot odds to be on your side. (more…)

Sometimes Good Fortune Pays

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Yesterday was one of those days.

We had network issues, so I spent most of my day working offline. I haven’t done that in a long, long time. As frustrating as the outage was, it saved me a little bit of cash because I was ready to fire off a few directional trades. After looking back at the SPY chart I would have most likely entered into a trade around $176.80 so I saved myself roughly $0.40 or about $0.15 to $0.20 per option contract. Hopefully, my good fortune continues today when I attack this market with a few short-term trades. (more…)

Another Opportunity in XOP?

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Roughly one week ago we exited what would be a profitable directional trade in XOP.

XOP had climbed into a short-term overbought state, so I decided to short the ETF using puts. Now typically, I am a seller of options, but the set-up was just too good to pass up for an aggressive style trade so I bought a few puts. The result was a 74% gain over just a few trading days. While I’m not going to anticipate similar results this time around, I am excited about the opportunity ahead. (more…)

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